Several Swiss household names form industry alliance to use Ethereum blockchain to improve OTC stock trading convenience

In Switzerland, some household names, including Swisscom, the largest telecommunications company in Switzerland, the Swiss Stock Exchange, and Zurich Cantonal Bank, the third largest bank in Switzerland, have formed a consortium to use blockchain technology to improve the convenience of stock trading outside the stock exchange. Mathias Bucher, the coordinator of the project, said:

“After a thorough evaluation of the available blockchain platforms, we decided to use Ethereum, and more specifically, Ethcore’s Parity client.”

According to Swissnews.com, the project is creating a blockchain prototype based on ‘real transactions for OTC stock clearing, settlement and reporting,’ which were chosen because they have very low trading volumes. If successful, the consortium will expand to more assets, including ‘globally traded financial products.’

It is not entirely clear whether the project will use Ethereum’s public blockchain or a private blockchain forked from Ethereum. We attempted to contact Gavin Wood, founder of Ethcore, who will serve as an advisor to the alliance, but did not receive a response as of press time. According to a translation of the press release, Bucher said:

“The functionality of Ethereum and its developer ecosystem creates a strong foundation for what we are going to do. Parity’s efficiency and private chain capabilities are ideal for use in a consortium setting.”

In terms of regulation, the alliance is supported by the Swiss Council of Technology and Innovation. In addition, Switzerland is emerging as one of the important blockchain technology centers along with London, California and Shanghai. In particular, the idyllic Swiss town of Zug, a town with a population of less than 30,000, has become the first choice for many blockchain companies, including the Ethereum Foundation and Xapo.

The town recently made history again when the mayor announced that municipal services would be accepted as payment in Bitcoin, showing a high welcome for blockchain innovation. However, the Swiss central government has not announced its views on blockchain technology and how they regulate financial technology innovation, but it is expected that the central regulator will show an encouraging attitude.

Blockchain goes mainstream

With some household names and organizations entering the testing and prototyping phases, blockchain is entering the mainstream and we could see some blockchain products hitting the market as early as next year.

The upcoming Blockchain Summit in Shanghai provides an opportunity to showcase blockchain technology, especially the Ethereum blockchain. Many industry leaders, bankers and policymakers will participate in this largest blockchain event ever. More than 30 blockchain projects will be announced in one day. More projects will be announced during the summit.

Such events are likely to continue, as the number of prominent companies participating in the event is enough to show that blockchain technology has become mainstream this year, at least among decision makers. In addition, Xinhua News Agency will be the media partner of the event. Therefore, we expect to gain new knowledge and understanding of blockchain technology, and blockchain will enter a new stage as we get closer to 2017.