IBM's Vice President of Blockchain Jerry Cuomo has announced a new form of blockchain implementation labelled “shadowchain”. It is supposed to work alongside conventional systems instead of replacing them.
In a recent interview, Cuomo gives the example of IBM Global Financing (IGF), an organisation within the IBM ecosystem that offers financial solutions for all IBM products and services, provides financial analytics and works with a wide range of clients, from small businesses to the majority of the Fortune Global 100 companies. Currently, it takes up to 40 days to complete a lending process with a client due to the disputes that may occur. With the implementation of a blockchain, it will only take 10 days: the disputes will be resolved easily because the key moments of the process will be fixed in the blockchain. Naturally, releasing the money 30 days earlier might become a strong incentive for businesses, claims the engineer.
But the most important thing is that the blockchain will not replace the traditional procedure of lending, says Cuomo. Instead, it will improve it.
“No, I'm not suggesting the moonshot of immediately redoing our global financing, lending system on a blockchain. But we have now employed a shadow chain: my definition of shadowchain is it's not replacing the primary business process, it's being used to enrich that business process with a useful function that it currently doesn't do,” he said.
The system would have probably been already launched if IGF’s partners had installed blockchain themselves. But so far the corporation is alone in its “shadowchain” effort and is still waiting for others to join.
At the same time, IBM is working on development projects that might produce blockchains capable of substituting some existing services altogether. This is, for example, Open Blockchain (OBC), the company’s cutting edge permissioned blockchain, which allows participation with various degrees of confidentiality. The corporation also participates in the Hyperledger project, and it is going to deprecate OBC as soon as Hyperledger produces a single code base, claims the engineer.
The shadowchain model follows the trend of more and more customisable blockchains developed and investigated around the globe by many corporations, including IBM. One of the options for the company to disrupt the way exchanges work is to offer them various blockchain services a la carte, thus supplementing the existing trading system, wrote Cuomo on the IBM website.
IBM is showing a keen interest in the blockchain technology. The company took part in the recent hearing on digital currency and blockchain held by the Energy and Commerce committee of the US Congress, where the corporation was represented by Cuomo.
Andrew Levich
