The Regulated Liability Network in the United Kingdom has selected R3, a firm specializing in enterprise distributed ledger technology and services, along with Quant, a blockchain provider for finance, to create the technology prototype for its experimental phase.
Led by UK Finance and supported by EY, this endeavor aims to enhance regulatory solutions in the financial industry.
The vision for the UK RLN entails a unified ‘innovation platform’ that integrates various currency types, including current commercial bank deposits and a shared ledger for tokenized commercial bank deposits. This collaborative effort within the financial services sector seeks to explore opportunities for users to engage in payments, transactions, and fulfill obligations in the evolving digital marketplaces of the future.
Major participants in the UK project consist of Barclays, Citi, HSBC, Lloyds Banking Group, Mastercard, NatWest, Nationwide, Santander, Standard Chartered, Virgin Money, and Visa. With support from EY and Linklaters, the technological framework for this initiative involves R3, Quant, DXC Technology (DXC), and Coadjute.
The Initiative
This initiative leverages R3’s expertise in delivering sophisticated projects tailored for regulated markets, utilizing its crucial shared ledger functionality through Corda, in conjunction with its Digital Currency solution from the newly introduced R3 Digital Markets product suite. Simultaneously, Quant brings its proficiency in enabling programmability and interoperability across various monetary forms, providing the orchestration and API layer through its Overledger platform.
Leading global banks and institutions will utilize the platform to explore a range of retail and wholesale payment scenarios, including e-commerce, bond issuance, delivery versus payment, and cards gateway integration. DXC spearheads the system integration efforts, with support from Coadjute’s innovative Home Purchasing Business Application—a property market infrastructure and settlement model built on R3’s Corda.
The technologies offered by R3 and Quant, designed specifically for deployment in highly regulated environments like this, present robust solutions. R3’s shared ledger and Quant’s Overledger API-based platform have the capability to effectively connect disparate systems. This strategic partnership underscores their complementary approaches to achieving interoperability and seamless integration.
Common Objective
Kate Karimson, chief commercial officer at R3, expressed, “The RLN initiative is uniting the industry to pursue a common objective—leveraging the advantages of tokenised finance in a regulated, orderly, and interoperable manner.
“We are honored to lead and execute the technology stream for the Experimentation Phase supporting the UK RLN. This marks a significant milestone for R3 and underscores our technology’s role in facilitating the digitalization of real-world assets and currencies in complex and highly regulated sectors.
“In the future, the RLN could establish a digital infrastructure that enables firms across the ecosystem to connect and drive further innovation. We are thrilled to be part of this pioneering initiative that may inspire future innovations.”
Jana Mackintosh, MD of payment innovation and resilience at UK Finance, added, “R3’s shared ledger technology is a valuable asset for this experimentation phase. This project aims to test hypotheses regarding the anticipated benefits of a UK RLN as an innovation platform, essential for future-proofing and advancing the UK’s financial infrastructure.
“Quant’s expertise in connectivity and smart contracts will be instrumental in the UK RLN proof-of-concept as we aim to simulate the integration of participants’ existing systems and explore programmable payments that enhance use cases and business processes.”
Furthermore, Gilbert Verdian, CEO and founder of Quant, emphasized, “In an era dominated by digital advancements, there is a growing expectation for global, secure, and scalable digital financial operations. However, our legacy financial infrastructure has lagged behind. As the UK strives for a leading position in financial markets, projects like the RLN underscore the pivotal role that shared ledgers will play in this transition, offering a model that can be extended to other markets.”