The State of Delaware is open for blockchain business and has announced a new category of financial instrument – "distributed ledger shares".
Delaware Governor Jack Markell took to the stage at the kick-off of the blockchain and Bitcoin industry meet-up, Consensus 2016, and explained how the state would be proceeding in technological and regulatory direction with blockchain.
Markell said Delaware has been a front runner in new technology; 1983 saw the introduction of uncertificated corporate shares, and this has evolved through the 1990s with electronic corporate record transmissions, electronic director votes and things like virtual stockholder meetings.
He said: "The next logical step in this process is the development of a new category of corporate shares: distributed ledger shares.
"Right now the state is in the planning stages; we believe this project has great potential but we also must be prudent. Our aim as is always is to harness benefits of new technologies while minimising the risk for businesses.
"There is simply no technological reason today that clearing trades should take so long.
"Distributed ledger shares hold the promise of immediate clearance, immediate settlement and bring with them dramatic increases in efficiency and speed in the sophisticated commercial transactions for which Delaware is known.
"One specific example is the programmatic management of capitalisation tables, and share registries; many companies are staying private longer and longer. And so keeping track of shareholder rights after ten or more rounds of financing, each with different terms and conditions can be like solving a logic puzzle.
"Companies are feeling this frustration every day. We see companies allocate significant financial resources to correct and validate stock authorisation and issuance errors that could have been correctly and seamlessly handled from the outset."
The technology underpinning the Delaware blockchain initiative is supplied by Symbiont, the smart securities and capital markets experts.
On a panel following Governor Markell's announcement was Mark Smith, CEO, Symbiont. He said: "I think we are good fit for Delaware because we have a very flexible and extensible system. So our platform is really designed around smart contracts and being neutral to the underlying ledger layer.
"It's not about the ledger layer for us it's about the intelligence of the smart contracts."
Smith also talked about a partnership Symbiont is involved in called Smart Loans. This will be incorporated in Delaware. "We are moving it there and we will be using the blockchain there."