The Illinois Department of Financial and Professional Regulation has joined the blockchain consortium initiative led by financial innovation firm R3 and has become the first state level regulator to join the group.

R3 counts a number of national regulators amongst its member base. The R3 team of financial industry veterans, technologists and cryptocurrency experts collaborate with members on research, experimentation, design and engineering to help advance this technology to meet banking requirements for identity, privacy, security, scalability, interoperability and integration with legacy systems.

The Illinois Department of Financial and Professional Regulation will be collaborating with over 80 of the world’s largest financial institutions to develop groundbreaking commercial applications for the financial services industry that leverage the appropriate elements of distributed ledger technologies (DLT).

“As Illinois’ financial regulator, we are committed to embracing the potential that distributed ledger technologies bring to our financial institutions. Its potential to dramatically lower transactional costs, automate manual processes, and reduce opportunities for fraud and risk are truly promising. Through our collaboration with R3, we look to provide the support necessary to ensure the commercial and social viability of this emerging technology”, Secretary Bryan Schneider, said in a statement.

Members work closely with R3 to continue the development of Corda, an open source distributed ledger platform for recording, managing and synchronising financial agreements. Corda is heavily inspired by and captures the benefits of blockchain systems, but with design choices that make it able to meet the needs of regulated financial institutions.

"Regulators that foster and encourage adoption of innovative financial technology in its early stages play a crucial role in creating a safer, more efficient financial system for all participants. We have actively engaged with regulators, trade associations and government entities across the world since R3’s inception, and look forward to working with the State of Illinois to explore how distributed ledger technology can benefit banks and other businesses in the state”, David Rutter, CEO of R3, said.