When evaluating blockchain platforms for use with our NuArca solutions, one of our primary areas of inquiry is performance and scalability. As a team we have collectively spent hundreds of years building and deploying enterprise class solutions to the global financial services market. It is clear, to anyone who has spent time with the non-functional requirements for the FS industry, that not all blockchain and DLT technologies are ready for average volumes let alone peak-load periods. And when you can’t handle volume in financial services, money is lost. And if a financial service institution thinks there is any chance that money will be lost, they will avoid that solution like the plague.
In other words, solve the performance and scalability problem, or your software/service is DOA.
To fully grok the gap between today’s capabilities and what is actually required, it helps to know that according to ITG, on average, in the US market for Q1 2017, there were 150,902,100 shares traded per day. Given 62 trading days in Q1 2017, and a 6.5 hours of open market per day, that is an average of 6,449 shares traded per second. Leaving aside the critical challenge of even greater peak trading volumes, compare that number to performance stats you can find for any blockchain technology.
The vision of underpinning the financial service industry with blockchain is undeniably compelling. Solving performance and scalability issues is just one of the critical paths of achieving that vision.
Hyperledger’s announcement of a Performance and Scalability Working Group (PSWG) is a welcome and much needed mechanism to create focus and drive energy towards addressing this challenge. For our first solution, we have the performance and scalability we need. For the future, we all need faster, and scalable technology backbones.
We have joined this group, will participate with intense interest, and contribute where and when we can.