Bank of America explores Blockchain with the help of Ripple & Algorand
Bank of America, Ripple and Algorand
There are two things to know about Bank of America - it is the second-largest bank in America and their aversion towards the blockchain technology has been pretty well-documented. However, it turns out that the financial giants are warming up to blockchain technology. They have been secretly testing our Ripple’s DLT in its banking system.
According to this article by FXStreet:
“Bank of America will likely use one of Ripple’s flagship products, xCurrent. Bank of America is silent on the issue owing to its previous hard stance on blockchain-related services. Interestingly, the bank listed a job posting in search of a “Ripple project product manager.” This makes it pretty evident that they are serious about blockchain and, specifically, Ripple adoption.”
Whatever product they use, this is still huge news. But you might be wondering, what does this have to do with Algorand?
Well, turns out that Barclays and ISDA (International Swaps and Derivatives Association) had just wrapped up their global hackathon. Can you guess who won the NYC contest?
Yup… A team from the Bank of America.
Can you guess what platform they used to build their winning application? Algorand.
Algorand is an open-source software company building technical innovation for the borderless economy. The brainchild of Silvio Micali is ably supported by a strong team and backed by solid engineering and cryptographic principles. The platform has recently attracted a lot of attention from institutions. One of these institutions happens to be the “Bank of America.”
Here are some reactions from Redditors regarding this news:
“Only a handful of good projects get to attract Institutions. Wonder why they are building on top Ripple and Ethereum, whilst ignoring the rest... Big news that Bank of America is using Ripple and now Algorand, this really establishes more credible for crypto startups.”
“BoA is more interested in ALGO, they are already building on their platform. They won the hackathon and they love the direction ALGO is headed in with their borderless economy.”
“ALGO could be a perfect platform for The Bank of America to build a derivatives platform on. Good to see major banks taking the steps in the right direction. I do agree with you, ALGOs borderless economy is definitely heading in the right direction.”
This is not the first time that Algorand has attracted institutions
This instance is the latest in the string of institutes adopting or experimenting with the Algorand.
- IDEX, Ethereum’s biggest decentralized exchange, will use Algorand to create solutions that provide full finality, tokenization of assets, and programmatic transfers at the Layer-1 level itself.
- Real estate startup AssetBlock had partnered with Algorand to launch a $60M Real Estate Investment Platform.
The reason Algorand has been attracting several businesses to its platform lately because of its scary potential. Algorand aims to solve the much-touted “blockchain trilemma” - security, scalability, and decentralization.
The way they aim to do that is by incorporating the pure proof-of-stake (pure POS) algorithm. Anyone with the ALGO tokens can take part in the public, permissionless, pure PoS consensus mechanism. In pure POS, anyone who wants to participate in the consensus protocol can do so by flagging an account with the ALGO tokens instead of locking it up. “Pure” means that validators can come and go as they please as their ALGOs are not locked up or “bonded” for any period of time like other proof-of-stake systems.
Along with this, Algorand also provides:
- High Scalability Potential: The entire Algorand community can confirm blocks and transactions with latency on the order of a minute while scaling to many users.
- Low Fork Probability: Even if there is temporary dissension within the network, Algorand makes sure that no users have different views of a confirmed transaction.
- Randomization: Since the proposers and committees are randomly selected, the network isn’t controlled by a few miners or validator set.
- Governance: Community token holders can change protocols
What is next for Algorand?
Algorand is backed by some leading cryptocurrency and tech funds, including Metastable, Sparkpool, MultiCoin Capital, AlgoCapital, or even NGC. By incorporating ingenious scalability innovations, Algorand has created a perfect platform to build large-scale dApps.
These collaborations with industry giants like Bank of America show us that the platform definitely has a lot of promise and will surely be attracting more institutions in the near future. Meanwhile, let’s hope that more banks and financial institutions take BOA’s lead and start experimenting with DLTs and smart contracts.