Corda is a tool designed to process and store legal agreements. Under the hood, a business-to-business messaging protocol allows known and authenticated individuals to form and validate legal agreements between each other. These agreements are registered using a notary service and can utilize an oracle service for the provision of context-based, independent facts (such as the current exchange rate).

Developed in collaboration with large financial institutions (such as banks and insurance companies), the Corda framework involves substantial infrastructure investment. This infrastructure is designed to dis-intermediate the current centralized clearing and settlement process that is prone to expensive reconciliation. To decentralize the clearing and settlement process, Corda generates a shared digital record between transacting parties. These shared digital transactions (termed smart contracts) are checked for uniqueness using a notary service – ensuring that legal claims regarding assets are registered in the event a dispute arises.

The Corda platform uses a peer-to-peer communication for generating agreements over a network. The platform requires an online services for registering transactions (notary service) and integrating publicly known facts (oracle service). Both notary and oracle services operate over the internet and could be classified as SaaS technologies.

Corda sought to build a solution for automating the complex legal agreements that utilize various forms of assets. Blockchain technologies that utilize a fully distributed ledger, such as Ethereum and Bitcoin, lack privacy for transactions and cannot assure both parties that the transaction is final upon formalizing the agreement (due to community based consensus requirements). Corda sought to address this issue by developing a multi-lateral ledger system that viewed consensus for agreements as a matter addressed by the transacting parties, not by the broader Corda network of businesses.

A fully distributed ledger is one that includes all transactions undertaken on a network. Ethereum and Bitcoin utilize this approach, and it does make some sense when dealing with fiat currency and large numbers of anonymous users. One of the challenges with a fully distributed ledger is the size; Ethereum is over 1,000 GB in size and growing. Aside from the mere cost of storing and processing a fully distributed ledger, the design is such that all users store all data from all businesses. This raises substantial security and privacy concerns for the business community.

A multilateral ledger addresses the question of how to interact with other users while maintaining privacy over agreement content, yet attaining assurance that agreements are final and binding. Using a multilateral ledger, a business stores all transactions for which they participate or observe. In addition to the agreement content, transacting parties attain all historical transactions for any given asset attained. This allows for a substantial reduction in scope of shared data and keeps data private; accessible only on the ledgers of transacting or observing parties. This reduced scope lowers storage and infrastructure costs. In addition, the ability to transact with finality allows businesses to rely on that transaction without the risk of transaction reversal due to conflicts; a scenario relatively common in fully distributed blockchain systems.

Expected Outcome

The Corda framework is the newcomer on the scene. Though new, the R3 organization that developed Corda is well funded with $107 Million ‘Series A’ funding closed in May of 2017. In addition to funding, partnership with large cloud service providers such as AWS and trials being undertaken by businesses and governments around the world indicate a keen interest in the Corda platform. In 2018, Corda has celebrated it’s first commercial launch with Finastra utilizing the platform for syndicated loans. R3 currently leads a consortium of more than 200 firms in R&D of distributed ledger technologies for use in financial systems. This is remarkable amount of traction for a company that was founded in 2014.


The Corda platform provides a rather unique approach to sharing assets between businesses. Although Corda was developed for very large-scale financial systems, the basic design and model could substantially help many entrepreneurs and small businesses. The ability to exchange assets of any kind and size, keep information private, and automate legally binding agreements could transform the way that small business collaborate with each other. I would expect that more innovation in this area will be seen over the next several years. GitHub brought technological tools to developers in a way that reduced barriers and transformed collaboration. I believe that tools such as Corda may be able to transform how businesses collaborate and generate value for customers. This is an ambitious vision, and only time will tell if this technology can truly revolutionize the business world.