Bold Business recently revealed the war breaking out in the Bitcoin community over how best to improve transaction processes. However, American banks are now getting in on the action. Several big banks announced that they are investing millions of dollars into developing blockchain-like technology for financial companies around the world. Bank of America, Merrill Lynch and HSBC are teaming up with Intel and dozens of other institutions to contribute $107 million to the R3 group to develop new banking technology. However, Goldman Sachs and Santander decided to pull out of funding the project in an earlier round.
“The R3 group is a collective of major banks working together to bring refined and improved distributed ledger technology to their processes, based on the blockchain,” Finder.com states. They plan to take Bitcoin head on in the battle of online transactions and cryptocurrency. R3 intends to perfect its own blockchain technology, the infrastructure that supports the cryptocurrency bitcoin, which is causing headaches for industry decision-makers due to issues with transaction times.
R3 Group Takes on Bitcoin
“The R3 group is hoping their investment will deliver a similar but better blockchain-like transaction process which they claim will revolutionize banking,” Australia’s leading financial comparison website adds.
They plan to take Bitcoin head on in the battle of online transactions and cryptocurrency.
Industry sources say the first $107 million round of R3 funding will materialize soon, followed by further two rounds over the next few years.
“R3′s ultimate goal is to connect all banks within the group who will then be able to operate between different institutions,” Sources say.
However, the main concern among financial bigwigs is that there are several leading tech firms working on different distributed ledger technologies, which could mean they are not compatible with each other. Bitcoin transactions have become more time consuming and problematic of late which could turn customers off, and serious issues have arisen over the best way to deal with it. According to Business Insider, developers and stakeholders are locked in a battle over how best to scale the network, stating that “bitcoin is in crisis”.
The average time it takes to complete a bitcoin transaction is 13 minutes, and companies including Bitpay and Coinbase are increasing the cost of their administration services to cater for the antiquated and time-consuming transaction process. Experts say that if Bitcoin is to become a commercial success then these issues need to be ironed out for long-term growth. However, although the community is in full agreement that a revamp is needed, there is massive divide over what is the best course of action for an effective streamlining process.