The high profile departures from the R3 blockchain working group raise questions about the commercials of the venture’s business model, according to an industry expert.
Nick Weisfeld, data practice head and blockchain specialist at GFT, has said that the issues are not with the potential of blockchin technology.
Weisfeld’s comments come following a turbulent week for R3 which has seen Santander and founding member Goldman Sachs depart the group.
Reports from the Wall Street Journal also indicate that Morgan Stanley have departed the project.
“Consortium aside, the crux of the issue is not to do with the interest in or potential of blockchain technology, but to do with the commercials of the business model,” said Weisfeld
“It’s not yet clear how this is going to work, other than that the banks are adamant that they are not going to create another commercial entity that can hold them over a barrel when it comes to operating fees. These departures show that there is a real question over the value being generated by R3, and an even bigger question over their ability to commercialise.”
An R3 spokesperson described the comments as “odd.”
R3 was founded in 2014 by nine banks including Goldman Sachs, Credit Suisse, JP Morgan and others with the goal of applying blockchain technology to commercial markets.
Earlier this year, R3 revealed that Brazilian exchange group BM&FBOVESPA and China Merchants Bank (CMB) had joined its blockchain partnership.
Wesfield went on to suggest that the industry is starting to see “real world applications of blockchain” and that the industry must go through this initial phase first before agreeing to universal standards.