AmEx Joins JPMorgan, IBM in Hyperledger Blockchain Effort

The biggest credit-card issuer by purchases, American Express, has signed on to the Hyperledger Project, a industry group of more than  100 members developing blockchain technology for corporate use, according to Bloomberg. The digital ledger known for underpinning bitcoin has potential to reshape the global financial system and other industries.

AmEx will contribute code and engineers to Hyperledger, which was started by the Linux Foundation in 2015 and now counts companies like IBM, Airbus and JPMorgan Chase as members. Many banks had previously joined a consortium called R3 CEV to explore ways to speed financial transactions using blockchain, but that group has lost members and last year formally joined Hyperledger.

“We want to get closer to blockchain technology and further imagine its possibilities and use cases,“ Sastry Durvasula, senior vice president of technology at American Express, said in an interview. While experimenting with various applications of the technology across its businesses, AmEx had yet to join an industry group. In 2015, its American Express Ventures invested in Abra, which uses blockchain to transfer money worldwide. The company sees blockchain as a “game-changing“ technology in banking, particularly digital payments.

Global banks are scrambling to find ways to use the blockchain as a decentralized ledger to transfer money, track contracts and clear complex financial transactions. To banks, the blockchain also has an intriguing security feature: Entries can’t be erased or modified unless the parties agree to the changes. But regulatory hurdles and changes required to complex corporate processes have so far slowed its adoption. Still, commercial deployments using Hyperledger’s code could begin this year, according to Brian Behlendorf, executive director of Hyperledger.