Blythe Masters: Blockchain commercial applications have reached a turning point

Blythe Masters, the former head of JPMorgan Chase, may have played a guiding role in the development of blockchain technology, and the blockchain company Digital Asset Holdings (DAH) founded by her has also undergone some changes.

No longer content with building tools that make the industry more transparent and streamline business processes, Masters has now shifted its focus to the implementation of blockchain business applications.

In response to this shift, Masters’ Digital Asset Holdings (DAH) company released a white paper last week that, importantly, you don’t need to be an expert to understand. The paper, titled “Digital Asset Platform” (download the full paper), is not written for developers who build tools, but for managers who have the power to change the direction of financial institutions.

In an interview with CoinDesk, Masters explained:

“We are at a tipping point where blockchain technology is moving towards the mainstream and it needs to be understood by a more mainstream audience.”

However, Masters is not making significant changes to the company’s internal structure in response to clients’ requests. Instead, she believes the New York-based company, which has raised $70 million in funding, will be able to rely on its existing resources.

Digital Asset Holdings (DAH) has partnered with several large financial institutions, including the Depository Trust & Clearing Corporation (DTCC), Switzerland-based Six Securities and the Australian Securities Exchange (ASX), and Masters believes that the company’s infrastructure will be able to meet the growing market demand.

According to Masters, the 29-page white paper document explains all about the digital asset distributed ledger platform and the open-source library created by a third party based on DAML smart contract language.

Decoding Digital Asset Platform

Masters said many potential clients are acutely aware of the potential threats and opportunities of blockchain technology, but it is less clear how these blockchain platforms (including her own) can help these financial institutions, which is what the white paper attempts to address.

To illustrate the potential disruptive power of distributed ledger technology, the white paper divides the digital asset ledger into two components.

The first is its全局同步日志(GSL), which relies on the blockchain to preserve the privacy of counterparties and notify them of changes to smart contracts. For a more detailed description of GSL, you can find it in another white paper released by DAH in November.

The second part of the ledger, which has received less attention, is called the Private Private Contract Store Store, which is a virtual container for all verified smart contracts and the terms that counterparties have agreed to.

The non-technical white paper states that the digital asset ledger service is a完全集中式solution. To initiate adoption, only the “operators” of the infrastructure need to adopt the company’s platform, while participants only need to interact, similar to what they do in traditional networks.

While centralized adoption minimizes the benefits of distributed ledgers, operators can familiarize users with the technology while taking advantage of a more transparent method of transaction.

Regulatory tools

In addition to the above, Masters said the white paper also shows how regulators can benefit from distributed ledger technology.

Not only could regulators like central banks become clients (by using the platform to build blockchain-based fiat currencies), they could also be used to audit financial institutions, Masters said.

“The option for regulators to act as auditors (or in the language of the white paper, market participants) is one of the very positive features of this technology,” Masters said.

However, the business-friendly white paper also lays out potential regulatory hurdles (it warns of a potentially difficult transition period).

The paper states:

“Transitioning from the current centralized infrastructure to a multi-operator network that relies on a consensus algorithm could expand vulnerabilities by increasing the chances of network exploitation and could also create challenges for regulators in the short term.”

Open source blockchain

To speed up overcoming these obstacles, Digital Asset (DAH) plans to open source the software products they are building.

It is reported that as early as August, Digital Asset Holdings (DAH) announced that it would contribute its DAML smart contract language to the open source community.

But the exact time of open source has not yet been announced.

Meanwhile, blockchain banking consortium R3CEV has open-sourced its Corda platform and is expected to formally submit its code to the non-profit Linux Foundation's Hyperledger consortium soon. Last week, after Chain open-sourced its blockchain protocol, DAH revealed its Ivy smart contract language, as well as similar open-source plans.

Masters said she believes the world will be a better place once blockchain technology is widely adopted, and that the decision to open source DAML was not made out of pure philanthropy.

Open-sourcing its software reduces the risk of existing and future companies becoming "too proprietary," Masters explained.

“We’re very focused on the open source community and we want to make sure that our platform becomes more and more open, so anything that belongs to Digital Asset (DAH) can be shared if necessary,” Masters said.

She concluded:

“In the future, there will be customers who continue to have Digital Asset build solutions for their specific use cases, and there will be others who choose to develop their own solutions and build their own libraries and applications, just leveraging the underlying platform.”