Many banks are interested in using distributed ledger technology, but Santander has taken matters a step further by hosting a competition among blockchain startups. The event took place in New York yesterday at an Amazon Web Services popup loft in SoHo.
Distributed ledgers are not identical to blockchains, it should be noted — blockchains are a type of distributed ledger. The very word “blockchain” is going the way of bitcoin in banking circles — not to be spoken of.
But it was Cambridge Blockchain, a distributed ledger startup born in the shadow of MIT, that won last night’s challenge, which was hosted by Santander InnoVentures, startup community Onevest, and 1000 Angels.
Pictured at right are Julio Faura, head of R&D at Banco Santander and longtime blockchain evangelist, and Mariano Belinky, head of Santander InnoVentures. They discussed the case for distributed ledgers at banks, then it was up to the startups to say why their solution was the right one. A common question from the judges was, “Why a distributed ledger? Why not just a database?” One way to describe distributed ledgers is that they enable multiple parties to share a database without having to trust each other, and this solution does not fit all problems.
The five finalists are below:
- Coinprism showed off its openchain clearing and settlement platform, which uses colored coins, meaning many types of asset can be exchanged. Its platform backs up to the bitcoin blockchain periodically, which some judges viewed unfavorably due to scalability concerns.
- ExiVest demoed a marketplace for private equity. People with equity in startups can sell it using ExiVest, but judges questioned whether startups would be happy to see their value flowing from employees to hedge funds.
- Ribbit.me introduced a loyalty and rewards platform built on distributed ledgers. It is solving the trust problem of, for example, using airline miles to buy a hotel room.
- Midasium‘s platform offers smart contracts for real estate. Landlords can make their occupancy data available to investors, government auditors, tenants, lenders, insurers — but will they want to?
- Cambridge Blockchain offered an identity platform built on distributed ledgers. The basic identity providers are banks, due to KYC/AML regulations, but users can create proofs around their identity data, and control who accesses it.
Cambridge Blockchain won the $15,000 prize, as well as access to the expertise at Santander InnoVentures and Banco Santander. Onevest will help the startup prepare a pitch to the angel investors in 1000 Angels. Three semi-finalists were also mentioned by the judges: Gem, Augur, and Swift.
The judges, who also participated in an introductory panel discussion outlining the basics of blockchains, were:
- Mariano Belinky, managing partner at Santander InnoVentures
- Julio Faura, head of R&D at Banco Santander
- Juan Jimenez, corporate innovation director at Banco Santander
- Greg Schvey, Partner at TradeBlock
- James Smith, CEO of Elliptic
- Peter Smith, CEO of Blockchain
Judges Pascal Bouvier from Santander InnoVentures and Chris Larsen of Ripple were unable to attend yesterday’s event.1 - Reader Likes This Post