NEM blockchain solution passed SoftBank Group's bank ledger system evaluation

On April 13, 2016, SoftBank Corporation's Sumitomo Internet Bank (hereinafter referred to as "SoftBank Internet Bank") has successfully completed the general ledger operation test on the blockchain.

SoftBank Internet Bank confirmed that the test was completed in a simulated environment with exactly the same real accounts and transaction quantities, and there were no bugs or transaction delays in the entire operation process.

In this round of demonstration experiments, SoftBank Internet Bank used the "Mijin" blockchain (i.e. the private blockchain of NEM) provided by Tech Bureau Co., Ltd., and completed the entire process through a 6-node Amazon Cloud Server (AWS). During the entire test process, the system completed transactions such as remittances, transfers, withdrawals, balance receipts, and remittance receipts through 2.5 million accounts. It proves that in the actual banking operating environment, all types of business transactions can be seamlessly connected and various instructions can be completed quickly.

Detailed description of blockchain testing in remittance business

After one of the six nodes receives the interactive instruction "A transfers 10,000 yen to B", this node confirms the balance of A's account and transmits and completes the interactive information to the other five nodes. After confirmation by several other nodes, the system completes the node consensus construction and successfully creates a block in the blockchain. At the same time, the transfer is also confirmed to be completed synchronously.

Function as a bank general ledger system:

SoftBank Corporation Sumitomo Bank has demonstrated the suitability of a blockchain solution for bank ledgers at a high level of security. The tests proved that blockchain interactions worked flawlessly under three different conditions:

• The reliability of distributed ledger systems at high transmission rates.

In a test with a peak of 90,000 interactions per hour, the blockchain distributed ledger technology was verified to have no glitches.

• Node failure test

When 5 out of 6 nodes were shut down during the test, the same service test was performed to verify again that no failures occurred and that performance was not affected.

• Node tampering test

During the test, any tampering operation on the node was rejected and the anti-tampering test passed.

SoftBank Cyber ​​Bank’s conclusion: “In a major test of blockchain technology, the system functioned normally as a distributed ledger.”

Although the test results affirm the value of blockchain technology, it is not economically viable to immediately replace the existing system with blockchain due to the huge investment in fixed equipment in the banking system. Replacing such existing systems with blockchain systems requires a full assessment and improvement of the current system.

SoftBank Group said it is fully aware that the use of a distributed ledger system can greatly reduce hardware infrastructure and middleware costs. Currently, SoftBank Group uses an open architecture in its ledger system, and there are no technical barriers to connecting to the blockchain system, but it still needs to evaluate and consider other details.

At present, the general ledger systems of most Japanese banks are composed of expensive minicomputers or even large machines, with an initial investment of hundreds of millions of dollars, and it is difficult to make a brilliant turnaround in the short term. However, it is an irreversible trend that these systems are gradually being replaced by cheap and efficient systems represented by blockchain, and the impact of blockchain on large IT manufacturers will be obvious in the future.

Remark:

1. The experiment was jointly contracted and executed by Dragonfly Fintech and Nomura Research Institute (NRI), both of NEM's ecological chain. The experimental environment was built by Dragonfly Fintech on Mijin, a private blockchain using NEM blockchain technology. From the above news, the test was successful. This is a very important milestone for NEM, Dragonfly Fintech and the Technology Bureau, because in Japan, this is the first blockchain solution recognized by banks, and more importantly, NEM meets the actual operating environment of banks.

2. Japan's SoftBank Group is Alibaba's largest shareholder, holding 34.4% of the shares; Alibaba President Jack Ma holds 8.9% of the shares

Original text: Excerpted from Nikkei Fintech Magazine (free access for industry managers only)