Microsoft, Goldman and others collaborate on privacy-enabled blockchain Canton Network
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Digital Asset, along with several traditional financial firms and technology giants, are collaborating to launch the Canton Network – a privacy-enabled blockchain network designed for institutional assets.
According to a May 9 press release, the new network will launch in July when network participants — which include the likes of Goldman Sachs, Cumberland, S&P Global, SBI Digital Asset Holdings, Umbrage, Microsoft, Paxos, Deloitte, CBOE and others — would test its interoperability capabilities across a variety of applications and use cases.
With Canton Network’s design, traditional financial institutions can offer users new innovative products and experience a safer and reconciliation-free environment where assets, data and cash can be freely synchronized across applications.
“[Canton Network] creates a ‘network of networks’, allowing previously shielded systems in financial markets to interoperate with the proper governance, privacy, permissions and controls required for highly regulated industries.”
A principal at Deloitte Consulting, Joseph Cody, said the blockchain network is the first of its kind, adding that the Canton Network can help “tokenize assets, facilitate rapid cross-organizational settlement, create new marketplaces, and establish an immutable record of shared data and facilitate secure transactions.”
Canton is built on Digital Asset’s smart contract language, Daml.
How the Canton Network differs from rival blockchains
Canton Network says it combines the smart contract capabilities of blockchain networks like Ethereum (ETH) and Solana (SOL) with privacy features similar to Bitcoin Lightning and ZCash (ZEC).
According to its white paper, this helps differentiate it from other blockchain networks, which are limited in their operations. Some of these networks’ limitations include their layer 1 strict vertical limits on transaction capacity. Another challenge with these networks was that asset issuers had to relinquish control of that asset to a pool of pseudonymous validators.
“From a regulatory perspective, the data transparency and loss of control over assets make these networks unsuitable for use by financial institutions.”
Canton Network says it helps address these limitations by enabling applications across multiple subnets to interoperate without requiring a Layer 2 protocol or asset bridge.
“As of early 2023, financial institutions trade over $50 billion a day on the limited-access subnet of the Canton Network.”
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