UBS and Barclays, Credit Suisse and other large banking institutions launched a real-time Ethereum platform

nBankruptcy Review: In response to changes in regulatory requirements and the timely implementation of new regulatory requirements, the Swiss banking giant UBS led the effort to join hands with Barclays, Credit Suisse, KBC, SIX and Thomson Reuters (Thomson Reuters) together to build a distributed data reconciliation platform based on Ethereum to make it easier for banks to coordinate a large amount of data on counterparties to simplify the compliance process.n
nTranslation: Clovern
To promptly and strictly enforce the new regulatory requirements, some of the world’s largest banks now disclose that they will cooperate in pilot projects that use Ethereum to streamline the compliance process.n
The project, led by the Swiss banking giant UBS and conducted with the help of Barclays, Credit Suisse, KBC, SIX and Thomson Reuters, is internally called Big The Massive Autonomous Distributed Reconciliation Platform (Madrec) is designed to make it easier for banks to reconcile their large amounts of data on their counterparties.n
Traditionally, it is common to use so-called “legal entity identifiers” to store regulated companies in a global data system to execute trades on behalf of clients, even though such clients do not have such codes themselves. However, a comprehensive regulatory reform called the MiFID II, which is scheduled to take place in the European Union on January 3, 2018, stipulates that all eligible legal entities must own and use these codes.n
However, instead of requiring these agencies to conduct separate exams, these banks set up Madrec to do some of the work in the industry-wide reconciliation process hosted in Microsoft Azure cloud services.n
In an interview with CoinDesk, Peter Stephens, head of UBS’s blockchain development program, explains how blockchain infrastructure can help save money without sacrificing competitive advantage.n
Stephens said:n
n”This will be our first online project”n
‘No harm’n
nTo promote the platform, Stephens led CoinDesk’s correspondents to UBS Labs, which drew up Madrec, and described in detail how the blockchain platform can help ease regulatory demands.n
The platform, which lasted six months, eventually evolved into a smart contract-based network designed to consolidate identifiers supported by agencies such as the LEI (R) Regulatory Oversight Board (LEI ROC). Reconciliation of LEI reference data also includes industry segments and information from the European Securities and Markets Authority (ESMA).n
Blockchain smart contracts will ensure near-real-time accuracy without requiring each company to examine the information individually and adjust the results on a regular basis.n
For this reason, anonymous reference data will be hashed to the Ethereum blockchain, and the source data itself remains within the organization. Smart contracts then reconcile the data so that users can quickly detect the anomalies and make adjustments.n
As each eligible entity will follow the same standards, Stephens believes helping each other ensure the accuracy of their work will only have a positive impact on their respective book profits, leaving room for competition elsewhere.n
“This is a public reference rather than a factor that differentiates companies from competing,” he said, adding:n
n”It’s something that’s” no harm and makes the world better. “It’s good for regulators, and we’re going to include data providers, but not to subvert them, and we’re going to include other bank.”n
Simulated live pilotn
Initially the project was called Project Conrad internally and was later renamed as the “Large-scale Autonomous Distributed Adjustment” platform and was largely hatched in the bank’s R u0026 D laboratories in different locations in London.n
Located in the 39th floor Financial Technology Workspace office in London’s Canary Wharf, the lab is designed to be a “neutral space,” and contributors from multiple partners are currently preparing six blockchain projects that are scheduled to go live next year.n
Perhaps most notably, the site is where UBS launched the “Utility Settlement Coin” project, which was also run by a group of financial institutions.n
As for the Madrec pilot, it is currently being tested in a simulated live environment using 22,000 non-sensitive reference attributes of cash equity issuers. The pilot is expected to be completed by the end of next month, and its further phased launch will depend on the pilot results.n
Lee Braine, CTO, Barclays Investment Bank, told CoinDesk:n
n”This precise use case makes it easier to understand innovative cryptographic techniques that allow every bank to preserve data privacy while also checking their own data against the underlying data maintained through community consensus.”n

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