While much noise was emitted in recent days, and probably rightly so, on the subject of the Facebook’s Libra project, there is in fact already in operation a global, publicly available, permissioned network of nodes governed by an independent foundation, representing the ecosystem stakeholders — the Corda Network.
The place where “…banks, oracles, market infrastructure firms, and regulators come together on a single network, able to transact directly with each other, and able to share services such as ordering services and gateways to other networks.”
James Carlyle, Chief Information Officer of R3, and the first Director of the Corda Network Foundation
The vision of the Corda global network is to provide the standards, infrastructure, and services necessary for the Corda nodes to be onboarded, to connect to each other and to enter into transactions, with transaction privacy, legality and finality. This vision has been created in response to the specific requirements of the potential network participants for a Distributed Ledger Technology environment where they can transact securely and directly with known peers in accordance with strict real-world regulations and with proper transparent governance. To achieve this vision, the Corda Network provides essential services allowing for identity management and control, connectivity, and a network consensus mechanism:
- Network map service, enabling the participants to find and communicate with one another over the network. The service is provided by a specialised Corda node.
- Notary service, providing network consensus and guaranteeing the timestamping, uniqueness, history validity and finality of each transaction without the need for costly block mining. Multiple notary pools, or clusters, may exist, and each of them can offer different validating features. A notary can be a “Validating notary” if it checks the transaction validity. In this case, the notary needs to see the full content of the transaction and its dependencies. Alternatively, the notary can be “nonvalidating”. Such a notary does not check transaction validity, so private data is prevented from a potential leak. Both notary types may exist on the same network, allowing nodes to choose the preferred notary service type for each transaction.
- Support service, providing the smooth running of the network and resolving any incidents related to other services of the network.
Governance — The Corda Network Foundation
To ensure that the network is operated in the interest of the network participants and in a fair, transparent and cost-efficient way, R3 has established the Corda Network Foundation to govern the Corda Network. The foundation is a not-for-profit, independent entity in which the Network participants elect, and can be elected to, a governing Board.
Inspired by other community-based foundations, like ICANN, Mozzila’s and Apache's foundations, and the Linux Foundation, The Corda Network Foundation is committed to the following principles:
- Fairness and openness. Participants can join the Network and make up the Network’s governing board, elected through a straightforward voting process.
- Democracy and transparency. Key decisions and rationale are shared openly with Participants.
- Stability (with a long-term view) with flexibility. Board directors’ terms last three years with a staggered board, and the governance model is flexible to adapt where required.
- Efficiency. The Network is a lean organisation sufficient to commission and monitor an Operator to run any services, physical infrastructure, or operational processes that may be needed to achieve the vision of Corda. It provides adequate support through advisory committees.
- Cost-effectiveness. Funding received through participation fees pays for an Operator to run the Network securely, and the Foundation shall not be a profit-making entity.
- Independence. Corda Network Foundation makes its own decisions (within the law), and is not following another entity’s rules.
The transfer of governance of the Corda Network to the Foundation ensures that the network is actually governed by its participants, and not by any single central entity and that the participants have the regulation and oversight of the network under their control. This governance structure allows for the participants to be involved with, and also understand, how decisions are made.
I Know That You Know That I Know.
The more participants join the Corda network, the more value it will bring for all of them — a phenomenon known as “network effect” or “positive network externality”. The vision for the Corda network is that it will be populated with participants of various business lines, self-organised in groups, or subnetworks, where information about shared facts is created and communicated, and processing of the information is implemented applying a common consensus mechanism. Such sub-networks of the Corda global network are referred to as Business Networks.
These networks would benefit from the existence of the services of the global Corda network, so they would not need to set up these costly services for each of them themselves. The business networks are free to establish their own membership criteria and to organise the onboarding of the nodes, where each party knows the identities of the other parties. The business networks would have their own requirements for data privacy and may transact with different digitised asset types. The business networks may have distinct business logic, reflected in the design and development of CorDapps (Corda Distributed Applications). Each business network would have a network operator — a party that manages admission to the subgroup and the application of the subgroup rules. Where needed, regulators may be able to oversee the relevant processes by deploying their own node on the network. A node may participate in a number of business networks at the same time, and transact directly with peers.
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