2025: A decade of DLT and R3’s leadership
As we step into 2025, the digital currency and tokenized asset industry stands at a pivotal juncture. The past year has been marked by substantial progress in the advancement of distributed ledger technology (DLT) as well as industry and public-private collaborations. R3 is proud to remain at the forefront of this transformation, providing the technological foundation for the financial markets’ next evolution.
Bridging permissioned and permissionless networks
2025 marks a significant milestone for the blockchain industry. This year celebrates the ten-year anniversary of the launch of the Ethereum network, as well as R3 and Corda. Over the past decade, both permissioned and permissionless ecosystems have grown substantially, transforming how markets operate.
Public networks like Ethereum have demonstrated the potential of permissionless platforms, enabling value to be exchanged securely and reliably on-chain in trustless environments. This past year, we have seen the proliferation of Layer 2 (L2) blockchains on the Ethereum network bring increased scalability and new real-world applications. Meanwhile, recognition of the efficiencies and design benefits that permissioned networks can generate in regulated financial markets remains high. Platforms like HQLAx and SDX are already leveraging DLT solutions for improved collateral mobility and faster settlement.
Yet, both ecosystems remain siloed. With modest transaction volumes in permissioned networks and permissionless networks having limited use cases in regulated financial markets at present, the industry must continue its interoperability efforts to unlock the full potential of blockchain technology.
The good news is that this will not take another decade to achieve, in fact, it should come much sooner. We predict that those firms who are already implementing production-grade DLT solutions will continue to lead progress in this area in 2025, driving interoperability efforts on permissioned networks. This past June, Fnality and HQLAx completed a cross-chain intraday repo settlement that bridged the Fnality Payment System — built on the DLT of Enterprise Ethereum — and the HQLAx digital collateral registry, powered by Corda. Collaboration between permissioned platforms will remain essential for unlocking DLT’s full utility for regulated markets.
Web3 projects like TEN Protocol are already integrating enterprise-grade security and privacy technology from permissioned networks into L2s for Ethereum to unlock programmable cryptography alongside fast finality, and massive scalability. This unlocks the Ethereum ecosystem in ways not seen before that leverage the best of both types of networks.
However, industry collaboration is not all that will be needed to realize the full potential of DLT as we look ahead to the next decade. The change in the American political landscape may bring broader market adjustments too. The approval of Bitcoin and Ethereum ETFs this year has already brought greater institutional interest and investment in cryptocurrencies, illustrating to big banks that the future of assets is digital.
The outcome of November’s election has led to anticipation of a more favorable regulatory landscape for tokenization and digital assets being led from the United States. Congress will finally address fragmented policies around stablecoins and cryptocurrencies, and regulators may look to adjust guidance on the use of DLT more broadly. Given this shift, it is reasonable also to expect that other jurisdictions may look to refresh their positioning to maintain a competitive advantage in the digital assets space.
Whilst competition may be the upcoming theme for regulators, collaboration at the national and international level, across industries, and between the public and private sectors has been a highly valued feature of the market.
Public-private sector collaborations on initiatives like the EU DLT Project and Project Agora are exploring how the technology could be applied to revolutionize both domestic and cross-border payments and create new forms of financial market infrastructure. The UK RLN, which leveraged R3’s Corda network to explore how tokenized deposits, was led by UK Finance and included eleven member banks, with support from EY, R3, Quant, DXC Technology, Coadjute and Linklaters. Operating within the current legal and regulatory structures of the UK, the solution could provide the next step in the evolution of commercial bank money.
In central bank digital currency (CBDC), projects such as Switzerland’s Project Helvetia and the Bank of Italy’s Project Leonidas illustrate the transformative potential of wholesale CBDCs for regulated financial markets. Project Leonidas also continued a phase of work with the Banque de France and the European Central Bank. Projects like these are exploring how to best provide central bank settlement for activities on DLT-based networks and the roadmap for doing so. Whilst much of that answer is still to be determined, these efforts are paving the way for production-grade implementations and supporting the journey whereby digital assets based on a range of networks can be settled using central bank money.
The Gulf region, where R3 supports the Central Bank of the United Arab Emirates Digital Dirham project, continues to be highly ambitious and is seeking to establish itself as a center for tokenization. The UAE’s Digital Dirham project has successfully demonstrated live retail and cross-border transactions, underscoring the region’s commitment to a digital-first future and the continued adoption of DLT in regulated markets.
A leader for in-production solutions
2024 was a year of milestones, from industry collaborations to regulatory advancements and transformative public-private partnerships. Tokenization continues to offer game-changing potential for financial markets, enabling instant settlement through delivery-versus-payment (DvP) and greater operational efficiency.
By integrating DLT with legacy systems, financial markets are achieving new levels of transparency, liquidity, and automation. The path forward lies in fostering international cooperation and creating interoperable systems that align with sovereign and regulatory requirements.
R3’s commitment to interoperability is a cornerstone of this vision, ensuring future-proof solutions that enable seamless collaboration between networks. As the industry continues to move forward in production-grade solutions, R3 remains the leader in in-production solutions globally, dedicated to enabling this evolution and fostering innovation and resilience in the digital economy.
