The name of the new R3 distributed ledger technology is derived from two sources, Brown explained in a story reported by Bloomberg Technology. First, it sounds like “accord.” Second, a “chord” is the shortest straight line between two points on a circle. The circle, in this case, being the banks that make up the R3 network.
“[Corda] is heavily inspired by and captures the benefits of blockchain systems, without the design choices that make blockchains inappropriate for many banking scenarios,” said Brown. “Corda’s design is the result of detailed analysis and prototyping with our members and will be open sourced when the code has matured further.”
“The technology we have used for our demonstration is the R3 consortium's prototype Corda platform,” said Barclays team leader Lee Braine from Barclays Investment Bank's CTO Office, as reported by International Business Times. “What you will now see is the first public demonstration of an application using the underlying Corda platform. This is history in the making."
According to Braine, each bank currently maintains its own ledger systems, which means there is huge duplication of effort and cost. This is a complex challenge that the fintech community is trying to solve with blockchains, shared ledgers and smart contracts. Smart Contract Templates, standardized yet customizable templates for running automated financial contracts, are designed for reuse and could drive the financial industry's adoption of standards that are legally enforceable.
The International Business Times report goes through the actual demo given by Braine at the Barclays Accelerator Demo Day, a prototype of an investment banking application showing the life cycle of an interest rate swap.
Braine emphasized that, following Corda specs, the prototype Smart Contract Template doesn’t replicate data to every node. “Corda has no unnecessary global sharing of data: only those parties with a legitimate need to know can see the data within an agreement,” noted R3’s Brown in the Corda announcement. “Corda transactions are validated by parties to the transaction rather than a broader pool of unrelated validators.”
"This type of solution will take time to build,” concluded Braine. “But it has the potential to transform legal documentation and enable legally enforceable smart contracts. Now that Barclays has planted the seed of Smart Contract Templates, further collaboration is required to grow this idea.”
R3 is organizing a Smart Contract Templates summit in June.