Deloitte, Goldman Sachs, Microsoft among institutional players collaborating on new blockchain network

An abstract illustration of a blockchain. Andriy Onufriyenko

A number of legacy financial and technology firms, including Deloitte, Goldman Sachs and Microsoft, have committed to join a new blockchain system, the Canton Network.

Digital Asset, a blockchain startup backed by some of the largest institutional finance firms and once led by former JPMorgan CEO Blythe Masters, is behind Canton Network’s implementation, which is built with the firm’s smart contract language, Daml.

“For the first time, financial institutions can realize the full benefits of a global blockchain network while operating within the regulatory railings,” Yuval Rooz, co-founder and CEO of Digital Asset, said in a statement.

Other participants in the Canton Network include BNP Paribas, Deutsche Börse Group, Cboe, Moody’s and even Paxos, a firm that creates stablecoins for crypto firms such as Binance as well as PayPal. Firms will begin testing the new blockchain starting in July, according to the statement.

Many of the firms cited in Digital Asset’s announcement have already been experimenting with blockchain technology for years, attracted by the possibility of the promised efficiencies of, for example, the tokenization of traditional financial assets, such as stocks or bonds, removing the middlemen who today audit financial products acquired from other institutions.

So far, these experiments have typically occurred within a firm, with banks and other financial giants creating their own proprietary blockchains. (JPMorgan, for example, has created the blockchain division Onyx.) The promise of the Canton Network is that, according to the statement, it is a “network of networks.” In other words, it can help connect separate blockchains together and allow companies to retain control over their own blockchain networks.

“By leveraging new blockchain technologies, we can potentially unlock new opportunities for market participants,” Cathy Clay, an executive vice president of Cboe Global Markets, said in a statement. “Efforts like the Canton Network will help our industry further explore this frontier.”

The rise of the Canton Network is further evidence that, despite the ongoing Crypto Winter and crypto’s reputation crisis following the fall of FTX, major legacy players are still interested in the promise of – and actively investing in – blockchain technology.

Publicly traded firms such as PayPal and Robinhood have recently announced upgrades to their crypto services, Fidelity has opened up crypto trading on its platform to general consumers, and firms such as Franklin Templeton have continued to invest in blockchain products, even Web3 game studios.