R3 Secures World’s Largest Distributed Ledger Investment with $107 Million

R3, the head of the world’s largest consortium of financial institutions collaborating to build a platform and commercial applications for distributed ledger technologies, announced it had secured $107 million in funding as part of its Series A round. The figure is the largest investment in distributed ledger technology to date.

Distributed Ledger for Financial Institutions

The consortium, led by R3, developed its own distributed ledger technology called Corda over several years of research and development. Similar to other blockchains like Bitcoin and Ethereum, Corda allows for the creation of immutable recording of financial events. However, unlike other blockchains, Corda was designed specifically for financial institutions and the unique problems they face: namely the requirement for privacy in transactions. Corda’s distributed ledger allows for financial institutions to transact privately but with immutable recording. In fact, it would be improper to characterize Corda as a blockchain even though it does share some of blockchain’s benefits since a blockchain by definition requires historical activity to be open to the public.  Given Corda’s specific application for financial institutions, it’s no wonder that numerous financial institutions would be members of R3’s group and want to invest in the company.

Diverse Group of Investors

Over 40 investors from over 15 countries participated in the funding, which was led by SBI Group, Bank of America Merrill Lynch, HSBC, Intel, and Temasek. Other notable investors include ING, Banco Bradesco, Itaú Unibanco S.A., Natixis, Barclays, UBS, and Wells Fargo.

David E. Rutter, CEO of R3, spoke of the record-breaking funding:

This investment is unprecedented. Many of the world’s largest financial firms have come together not just with capital support, but with a robust commitment to work with R3 in developing industry solutions that will be the building blocks of the new financial services infrastructure. We’ve got unparalleled momentum.

According to R3’s press release, the company will use the funding to:

[A]ccelerate technology development and expand strategic partnerships for product deployment. The company’s efforts will be focused on Corda, R3’s DLT platform for regulated financial institutions, and its infrastructure network, which will support a vast range of partner-built financial applications that interoperate seamlessly with each other, existing systems and networks.

The $107 million funding was R3’s third of four tranches of its Series A. The first two tranches were only open to R3 members, while the fourth and final tranche, which will open later this year, will be available to non-members as well. Given the hype surrounding distributed ledger technology lately, expect R3’s fourth tranche to smash records again.

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