Partnership with R3 will use Microsoft Azure to help push forward acceptance of alternative currencies in the financial sector
Blockchain technology, best known as the system supporting Bitcoin, has moved a step closer towards mainstream financial acceptance thanks to a new deal between Microsoft and alternative finance experts R3.
The partnership, disclosed at Microsoft’s Envision event in New Orleans, will help accelerate the development and implementation of blockchain technologies, according to the company’s CEO Satya Nadella.
Microsoft already accepts Bitcoin payments through its Windows 10 and Windows 10 Mobile platforms, but will now be looking to support the technology in the wider financial sector.
It says that the use of blockchain technology could possibly save organisations billions as they modernise and streamline what are often decades-old back-office operations.
The company will now work with R3’s network of 40 member banks to develop, test and deploy blockchain technologies, utilising Microsoft’s Azure cloud platform as well at the company’s range of partner Blockchain-as-a-Service offerings, which initially launched last year.
“Blockchain offers a secure and transparent way to digitally track the ownership of assets,” Microsoft’s Peggy Johnson said.
“Simply put, it promises to revolutionise the way financial institutions conduct transactions. Blockchain modernises legacy financial processes, so trades of assets like stocks and bonds can be finalised in minutes, not days. And by enabling a more direct transfer of ownership, it eliminates the need for middlemen like clearing houses, both cutting costs and greatly reducing the risk of fraud.”
In his keynote, Nadella noted that R3 “is using blockchain technology that is available on Azure as a service to fundamentally transform how transactions happen and how settlements happen inside of financial institutions.”
“Today, there is a lot of time delay between a transaction and when the money flows, and there’s a lot of cost,” he said. “And [by] using this distributed ledger technology and blockchain, you can change the landscape of the financial industry.”
Nadella added that blockchain has the potential to transform health care, manufacturing supply chains and the public sector.
Support for blockchain technology is another part of Microsoft’s new enterprise-focused strategy, which has gained further weight this week at the company’s Envision event.
Nadella yesterday revealed how the company is focusing on three interconnected areas to help its business customers adapt and thrive in digital transformation, describing a three-pronged strategy formed of personal computing ubiquity, productivity in business processes, and unbeatable cloud infrastructure.
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