Microsoft, JPMorgan to unveil virtual currency-based systems

Microsoft, JPMorgan Chase and other corporate giants are joining forces to create a new kind of computing system based on the virtual currency network Ethereum.

Some 30 companies are set to announce on Tuesday the formation of the Enterprise Ethereum Alliance, which will create a standard version of the Ethereum software that businesses around the world can use to track data and financial contracts. The new organisation, a non-profit, is part of a broader movement to harness the technological concept known as the blockchain, which was introduced to the world by Bitcoin.

Blockchains offer a way for unrelated computers and companies to simultaneously collect and store information without relying on a central authority, similar to the way that Wikipedia is written and maintained by a group of writers and editors rather than a single author. The technology is viewed as being harder to corrupt or hack because of its reliance on many people rather than a single authority. Many big corporations have been looking for ways to use blockchain technology to keep track of information created by unrelated companies, like stock and bond trading transactions.

IBM has made a particularly big push into the blockchain business, and it has been leading a separate collaborative project, known as the Hyperledger Foundation.

The new Ethereum alliance has been described by some of its backers as a way to ensure that the IBM-led blockchain effort is not the only option for businesses looking to use the technology. Other companies like R3 and Chain have also been developing alternative blockchains.

“We are pretty equally spending our time across the different chains,” said Alex Batlin, the global head of blockchain at Bank of New York Mellon, which is joining the Ethereum alliance.

Ethereum was introduced in 2013 by a developer named Vitalik Buterin, then 19, who had previously worked on Bitcoin. Since its official release in 2015, the Ethereum network has been the target of hackers and theft.

Yet it has also won a large following among programmers who view it as a new and sophisticated way for groups of people and companies to initiate and track transactions and contracts of all sorts.

Microsoft India (R&D) Pvt. Ltd.