Nasdaq Partners With R3 to Help Build Institutional-Grade Digital Assets

Nasdaq is partnering with the blockchain solution provider R3 to build institution-grade digital assets and marketplaces.

The world’s second-largest stock exchange and capital markets technology company, Nasdaq, has entered a partnership with enterprise blockchain solutions platform, R3. 

R3 announced the partnership on April 29, 2020, stating that Nasdaq will use its blockchain software, Corda, among other services. Their intention is to help financial institutions easily build and deploy institutional-grade digital assets.

This is a long-term, non-exclusive partnership between the two firms, which means Nasdaq can still collaborate with other blockchain solution providers to work on new projects.

R3’s compatibility with highly regulated environments inspired the partnership

Johan Toll, the head of digital assets at Nasdaq, said that they entered into a partnership discussion with R3 due to the platform’s compatibility with highly regulated environments that have a high threshold for the quality of services. 

“Their platform fits well into Nasdaq’s technology ecosystem and by connecting to the platform, we can harness the power of a scalable design that delivers a new level of interoperability and ease of integration to any current legacy technology system.“

Nasdaq, along with R3, plans to bridge the gap between financial institutes and blockchain-based digital asset solutions. They will help organizations issue tokens and build digital asset marketplaces. They will also support these organizations through various processes such as issuance, trading, settlement, and custody.

Eyes on the future

Nasdaq is preparing to deliver its services to organizations as they realize the potential of digitization and move from manual processes to digitized means.

Toll predicts that in the near future, we will see various financial and non-financial marketplaces for trading tokenized physical assets. This, he adds, will increase the transparency in the market and reduce friction by setting aside third parties.

There’s a great future for blockchain and digital assets in the financial sector but we first need to tackle blockchain’s interoperability issues, mentions Toll. Even the World Economic Forum recently published a white paper explaining that blockchain’s lack of interoperability is a major hurdle for enterprise use.