Peter Randall, one of the founders and former CEO of the alternative European stock exchange Chi-X, and Anthony Culligan, founder of peer-to-peer bitcoin trading venue Roolo, have announced to launch blockchain startup SETL. SETL will introduce a permissioned blockchain that is set to run on enterprise level servers and is said to be able to handle 100,000 transactions per second.
SETL will initially target the payments business to subsequently move into financial markets including foreign exchange, bonds and possibly stocks. Much like the Bitcoin blockchain, the SETL blockchain will allow users to transfer both money as well as assets directly among each other. The network will be generated from the servers of its participants, which will store the ledger of all transactions locally, using public key encryption.
As opposed to the Bitcoin blockchain, however, the SETL system is not permissionless. This means that each public key used on the network is to be certified by a regulatory body. As such, authorities will be able to identify and track all entities on the blockchain, with complete transparency of all transactions.
In a statement, Randall said:
“Clearing and settlement processes are fragmented, cumbersome, costly and in need of technological innovation and simplification. Our aim is to be platform, exchange, currency and asset agnostic. When you have agreed on a transaction, SETL will be the way to simultaneously move the consideration and the asset as well as provide a ‘golden record’ of the transaction.”
To create SETL, Randall has partnered with Anthony Culligan, an experienced hedge fund investor and founder of bitcoin trading platform Roolo. Culligan explained that SETL has been designed from the ground up to meet the needs of the financial sector. Perhaps most importantly, SETL is more in tune with the regulatory landscape than existing blockchains.
Culligan:
“Understanding how financial markets work has been key to the design process so far. Solutions in the world of finance need to address practical issues such as capital usage, bank liquidity and regulatory permissions. SETL is the product of the decades of financial markets expertise of its founders as well as genuine technical innovation.”
Blockchain technology seems to be making its way to the financial sector in a big way lately. Just last week, Greenwich Associates published a report in which the financial industry consulting firm predicted that blockchain technology would be embraced by capital markets. The NASDAQ stock exchange, meanwhile, said it expects to be the first exchange to use such technology. As opposed to SETL, NASDAQ is planning to utilize the Bitcoin blockchain.
Cointelegraph has reached out to Peter Randall and Anthony Culligan to inquire about the technical specifics of SETL, but has not received further details at time of publication.