Big Finance Firms Invest in New 'Zero' Blockchain

Important financial companies, including Citadel and ARK Invest, are supporting a new blockchain called Zero. This new system is made to help big banks and trading firms work better and faster. It hopes to make financial systems more modern.
By Newsroom | Business, Technology |

Key Firms Invest in LayerZero's 'Zero' Blockchain to Enhance Traditional Finance Infrastructure

Major financial players, including Citadel, ARK Invest, and Tether, are backing the launch of a new blockchain named Zero. This initiative aims to build robust trading systems suitable for Wall Street's demands, addressing concerns about speed, cost, and privacy.

Context and Timeline

LayerZero Labs, a company focused on blockchain technology, has announced the launch of its new blockchain, Zero. This project is designed to cater to the needs of institutional finance, with a stated goal of bringing global finance onto blockchain technology.

Ken Griffin's Citadel, Cathie Wood's ARK Invest Back Zero Blockchain to Drive Wall Street Adoption - 1

  • Investment and Partnerships:

  • Citadel: Ken Griffin's Citadel and Citadel Securities have made a strategic investment in Zero, including a token purchase of ZRO, the network's governance and staking token. Citadel is also working with LayerZero to assess how Zero's structure can support high-volume trading and post-trade processes.

  • ARK Invest: Cathie Wood's ARK Invest has also invested in Zero, acquiring both ZRO tokens and equity in LayerZero Labs. Wood is joining Zero Blockchain's newly formed advisory board.

  • Tether: The investment arm of stablecoin issuer Tether has also made a strategic investment in LayerZero Labs.

  • Intercontinental Exchange (ICE): The parent company of the New York Stock Exchange (NYSE), Intercontinental Exchange, is involved as an investor and advisor, with Michael Blaugrund, VP of Strategic Initiatives at ICE, joining the advisory board. ICE is reportedly exploring Zero's 24/7 trading capabilities.

  • BNY Mellon: Caroline Butler, former head of digital assets at BNY Mellon, is also part of the advisory board.

  • Global Token Exchange: This decentralized trading platform plans to build the treasury layer of its system, Turbo, using Zero.

  • Google Cloud: A partnership with Google Cloud is being explored to investigate how AI agents could facilitate micropayments and trading without requiring traditional bank accounts.

  • Technological Underpinnings:

  • LayerZero claims Zero blockchain achieves high throughput through advancements in areas like storage (QMDB), compute (FAFO), networking (SVID), and zero-knowledge proofs (Jolt Pro).

  • Zero-knowledge proofs are highlighted as a key technology enabling privacy-preserving verification of information between different parties.

  • LayerZero asserts that Zero's performance is significantly faster than existing blockchains like Ethereum and Solana, claiming speeds up to 100,000 times quicker than Ethereum and approximately 500 times faster than Solana.

  • Advisory Board: The advisory board for Zero includes Cathie Wood (ARK Invest), Michael Blaugrund (Intercontinental Exchange), and Caroline Butler (formerly BNY Mellon).

Focus on Institutional Finance

The Zero blockchain is explicitly designed to meet the stringent requirements of traditional finance (TradFi).

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  • Addressing Concerns: LayerZero aims to build "TradFi-grade trading infrastructure" that tackles Wall Street's current concerns regarding financial systems.

  • Market Structure Expertise: The project's objective is to integrate global institutions with extensive experience in market structure.

  • High-Throughput Trading: Citadel's involvement includes evaluating Zero's architecture for its ability to support high-throughput trading and post-trade workflows.

Key Figures and Their Roles

The involvement of prominent figures in the financial and investment world underscores the ambition of the Zero blockchain project.

Ken Griffin's Citadel, Cathie Wood's ARK Invest Back Zero Blockchain to Drive Wall Street Adoption - 2

  • Ken Griffin: Founder of Citadel LLC and Citadel Securities, a major market maker. He is known for his significant investments and philanthropic activities. His involvement suggests a strong institutional backing for Zero.

  • Cathie Wood: Founder, CEO, and CIO of ARK Invest, known for her focus on disruptive innovation and emerging technologies, including blockchain. Her participation on the advisory board signifies ARK's commitment to the blockchain ecosystem.

  • Bryan Pellegrino: Co-founder of LayerZero, who has articulated the project's vision of bringing global finance onto the blockchain and highlighted the technological breakthroughs enabling Zero.

Technological Advancements and Performance Claims

Zero blockchain introduces several technical innovations claimed to enhance its capabilities.

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  • Zero-Knowledge Proofs: This technology is central to Zero's privacy-preserving verification capabilities, a critical aspect for institutional adoption.

  • Breakthroughs: LayerZero claims four significant breakthroughs across storage, compute, networking, and zk-proving, enabling its high performance.

  • Speed Comparison: The project asserts that Zero can handle transaction volumes vastly exceeding those of Ethereum and Solana, potentially resolving speed and cost issues that have limited blockchain adoption in traditional finance.

Expert Perspectives and Market Interest

The launch has garnered significant attention from financial institutions and industry leaders.

  • Industry Enthusiasm: Leaders within the industry have expressed enthusiasm for the Zero blockchain's launch.

  • Exploration of Use Cases: Several major institutions are partnering with LayerZero to explore practical applications for the Zero blockchain technology.

  • Bridging the Gap: The project aims to bridge the divide between cryptocurrency and mainstream financial markets.

Conclusion and Implications

The backing of Citadel, ARK Invest, and Tether for LayerZero's Zero blockchain represents a significant development in the push for institutional adoption of blockchain technology. The project's focus on TradFi-grade infrastructure, coupled with claims of advanced performance through innovations like zero-knowledge proofs, suggests an attempt to address the scalability, speed, and privacy concerns that have historically been barriers for large financial firms.

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The involvement of figures like Ken Griffin and Cathie Wood, along with institutions like Intercontinental Exchange, signals a concerted effort to integrate blockchain capabilities into the core of traditional financial markets. The formation of an advisory board with established financial leaders further underscores the ambition to create a compliant and efficient ecosystem.

  • Future Exploration: The commitment from these entities suggests ongoing efforts to test and integrate Zero's capabilities into real-world financial operations.

  • Market Structure Impact: The success of Zero could lead to fundamental shifts in how financial assets are traded, settled, and managed, potentially ushering in an era of 24/7 trading and enhanced efficiency.

Sources

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Frequently Asked Questions

Q: What is the Zero blockchain?
Zero is a new blockchain made for big financial companies. It wants to make trading faster and cheaper.
Q: Which big firms are backing Zero?
Companies like Citadel, ARK Invest, and Tether are investing in Zero. The company that owns the New York Stock Exchange is also involved.
Q: Why is this blockchain important?
It aims to solve problems like slow speeds and high costs in current financial systems. It uses new technology for better privacy and speed.