AlistairDuffSept201614J

Global Symposium for Innovative Financial Inclusion

Distributed Ledger Technology - A new paradigm for Capital markets

The Significant Evolutionary Step of DLT

Shared Truth

Shared Logic

Shared Communication

Distributed ledger technology has benefits across the trade life cycle, while simultaneously offering a new paradigm for bank interconnectedness & reduced risk

Source: Oliver Wyman / Euroclear

Distributed Ledger Technology Ecosystem Impact

Trade Life Cycle Impact

6

Pre-Event Event Post-Event

R3

World Economic Forum Report on DLT

R3

R3 - A DLT Centre of GravityR3 has been instrumental in creating collaboration across a diverse range of financialservices industry participants

INSURANCE &ASSET

MANAGEMENT

EXCHANGES

MARKETSTRUCTURE /

UTILITIES

REGULATORS /CENTRAL BANKS

CARD PROVIDERS/ ACQUIRERS

BLOCKCHAINTECHNOLOGY

CO.’s

ENTERPRISETECHNOLOGY

CO.’s

TRADEASSOCIATIONS

R3

§ LRC - Center of excellence for distributed ledger innovation/collaboration across the entire financial services ecosystem

§ Secure, multi-institution Global Collaborative Lab focused on empirical experimentation, innovation and applied research in DLTs for financial services

R3 Operates on 3 Pillars

§ CORDA - Base layerreference architecture to underpin a global financial-grade ledger shared among all actors

§ Drive appropriate standards and open protocols to meet best interests of financial services community

Pillar 1Financial Grade Ledger

Pillar 2R3 Lab & Research Center

§ Center of excellence for distributed ledger technology acceleration and scalability

§ Product commercializationand growth.

§ Product financing and corporate structuring

Pillar 3Product Development

R3

R3’s Corda Platform: A Unique Distributed Ledger ApproachA blockchain-inspired distributed ledger platform designed and built specifically for financial markets

Key Features

§ Data is shared only among relevant parties§ Choreographs workflow between firms without a central

controller§ Consensus at individual deal level, rather than system level§ Design directly enables regulatory/supervisory observer

nodes§ Transactions are validated by parties to the transaction

rather than a broader pool of unrelated validators§ Supports a variety of consensus mechanisms§ Strong link between legal prose and smart contract code§ Uses industry-standard tools§ No native cryptocurrency§ Will be open-sourced

CordaManages and Executes Financial Agreements

Legal Interlock Interoperable Private

Shared Business

Logic

• Consensus

• Validity

• Uniqueness

• Immutability

• Authentication

R3

TRADEREGISTRY

ISSUANCE OFVALUE

REFERENCEDATAIDENTITY ASSET

REGISTRY

R3’s Technology “Stack”R3’s Platform will leverage Corda™ base architecture and seamless interoperabilityfunctionality to power the Platform, which enables commercial products and software on top

Asset-Specific Software, Applications and Business Process Solutions

SHARED SERVICES PLATFORM

INTEROPERABILITY / API LAYER

BASE ARCHITECTURE LAYER–CordaTM (Open Source)

Other Ledger Systems, e.g.:ETHEREUM RIPPLE CHAIN OTHERS Existing Market Services

Thank you & CloseThank You