Deutsche Bank is set to tackle compliance issues linked to public blockchain technology by developing a new Layer 2 protocol. This initiative, named Project Dama 2, aims to harmonize the efficiency associated with blockchain while adhering to regulatory demands, effectively bridging traditional finance with decentralized systems.
What Is Project Dama 2 About?
The objective of Project Dama 2 revolves around enhancing the functionality of public blockchains. By utilizing a Layer 2 protocol, the bank intends to lower transaction fees and ensure that all blockchain activities align with necessary regulations.
How Will Compliance Be Achieved?
This innovative solution focuses on lowering costs while boosting operational effectiveness, thereby ensuring adherence to regulatory frameworks. By employing a selective group of validators, Deutsche Bank aims to diminish risks linked to blockchain transactions while maintaining the scalability and interoperability of public networks.
Key highlights of Project Dama 2 include:
- Utilization of ZKsync technology to streamline transaction processes.
- Implementation of “super admin rights” exclusively for regulators to enhance transparency.
- Collaboration with Memento Blockchain Pte. and Interop Labs to ensure the protocol meets regulatory standards.
- Aiming for a minimum viable product release by 2025, pending regulatory approval.
This initiative marks a significant step for Deutsche Bank in aligning blockchain technology with compliance requirements. If successful, it could inspire other financial entities to adopt similar approaches, ultimately fostering greater blockchain integration within the finance sector.