IBM to Launch One of the Largest Blockchain Implementations in the World
Cointelegraph spoke to Jerry Cuomo, Vice President of Blockchain Technologies at IBM, about one of the largest implementations of Blockchain in the commercial sphere.
IBM has been in the IT business for over 100 years and they have been a dominant force in all this time. Over the years the company has made a mark on several areas in which it has come up with innovative ideas and products. They have had a hand in the development of the disk drive, magnetic strip cards, ATMs, Fortran language and much more.
It comes as no surprise then that IBM is also behind one of the largest implementations of Blockchain in the commercial sphere. IBM Global Financing is expected to use a Blockchain solution to address disputes in the financing arm of the company and free up tied capital, thus leading to more efficiencies.
In order to know more about IBM’s plans about the Blockchain in general and also the upcoming Blockchain implementation by IBM Global Finance, Cointelegraph talked with Gennaro ‘Jerry’ Cuomo. Cuomo has been with IBM since 1987 and is currently the Vice President of Blockchain Technologies which happens to be a business unit within the IBM Cloud Group.
IBM’s Blockchain Strategy
IBM has taken a three-pronged approach to the Blockchain - community, cloud and clients. They continue to maintain a focus on core technology which they do so as a community under the Hyperledger Project of the Linux Foundation. They are also determined to support this core technology by helping client services through the cloud. This allows their clients to spend less time worrying about Blockchain management and more on application development.
Finally, IBM is using Blockchain for interesting new cases like supply chains, auditing and client engagement. They have come up with IBM Garage which is useful for client engagement and supports Blockchain activity around the world. They have centres in New York, Singapore, London and Tokyo where IBM works with clients on Blockchain oriented design.
IBM Global Financing brings Blockchain to Real World
IBM Global Financing is the world’s largest IT captive financier and helps their clients access solutions that they require for their growth.
They finance IT hardware, software and services. IBM will soon be implementing a Blockchain solution that will allow them to handle dispute resolution more effectively, making this particular implementation of Blockchain the world’s largest.
Jerry Cuomo, Vice President of Blockchain Technologies at IBM says:
“You have this global finance lending network - we run $44 billion a year. And we can make this so much more efficient if we built it on the Blockchain and we shared the lending ledger with our partners and suppliers etc and we actually went into a garage session for a few days and we dreamed about it the first day and we were all excited. The fact that in any given year we see about 25,000 disputes within the lending network and this ties up cash, in some cases it can be significant cash....$100 million at any given time....could be held up in disputes. It should be made more efficient so a dispute did not take 40 days on average to resolve .”
IBM then ran a proof of concept earlier this year. They tested the use of a shared ledger to do compliance and triggered events which were from ledger to ledger to quickly resolve the disputes to find the last point in time where everything was agreed upon. They recorded 2 years of transactions on their lending network and ran simulations and were able to see that, on average, they were able to resolve a dispute in under 10 days.
Cuomo says that the results were exciting and they hope to be able to bring the Blockchain live:
“We are going to learn a lot, you know I don't think anyone is going to get to any of these big exciting projects in one step, we’re gonna have to take steps along the way and a dispute ledger is one type of thing that I think will educate us and also bring value, that's why we are very excited about this. So you know we are not just talking the talk with technology, you know the parts of IBM and some of the B2B networks that are also walking the walk, you know by trying out these networks, we hope to go live in the not too distant future with the dispute ledger.”
No one Blockchain to rule them all
It seems that while a lot of work is being done on Blockchain by IBM and others, there may be some inevitable reinvention of the wheel happening as well. The need for open standards and co-operation came up when we interviewed Cuomo.
Talking about interoperability, Cuomo says:
“I think the Blockchain that we are talking about will have to have special things like regulatory compliance but Blockchains will need to interoperate and the interoperability standards are going to be important as we go further down the road, so what better time to start than now? I have recently testified to congress at a congressional hearing but also at a presidential commission on national cyber security. Blockchain has come up on all of those and one of the messages that I have put out there was the need for standardization.”
There is also a question of open standards and more co-operation. Cuomo is categorical in saying that he feels that even cryptocurrency Blockchains have to work with each other and private Blockchains in the future.
“I absolutely think that there should be more co-operation. Blockchains have to work together even if they are different, even if they have a slightly different purpose. The Blockchain that we are working on in the hyperledger project needs to work even with the Bitcoin and Ethereum networks. These things have to interoperate to work together. I think the purpose of the hyperledger project is not only to produce different types of software assets but also to define interoperability standards. We should get the message out that please come and hang out with us at the hyperledger project regardless of what type of Blockchain you are working on. I don't think there is going to be one Blockchain to rule them all.”
Small steps can lead to a big moonshot
There has been a lot of talk of Blockchains in different spheres lately but before anything can become mainstream, it needs a lot of real world testing. This is especially true in fields where there is a lot of regulatory oversight like banking and finance.
We asked Cuomo his views on real world testing and he says:
“Blockchain has captivated the imagination of banks and many financial institutions, stock exchanges etc. You know how you can let them have settlements instantaneously instead of 3 days. All of this is within the realm of possibility now with Blockchain. I would say the more diverse the audience interoperating in the Blockchain network, again the longer things will take to get to production. However, there are many, many starting points that in my terminology I call moonshots, things that are absolutely worth striving for that take careful planning to get there but there are things that we can do along the way. In fact, without doing these things we would never get there, so, for example, client ledgers are a great place to start, hence every business big or small needs to be compliant about something and some compliance tracking is just boring and there is not a lot of value for businesses, but you have to do it and you have to do it right.”