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Banco Santander, one of the early participants of the R3 blockchain consortium has abandoned the working group, joining investment banking institution Goldman Sachs in departure.

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The Spanish banking giant’s decision to let its R3 membership lapse is the second high-profile exit from the working group and comes in the months after it roped in Blythe Masters for a blockchain advisory role at the bank. Masters is the chief executive at Digital Asset, a startup that is arguably R3’s competitor in developing blockchain solutions for the financial services industry.

Santander crest

Santander is the second major bank to leave the R3 blockchain consortium.

While reasons for the departures aren’t provided in any official capacity, R3 is currently in the midst of raising its first major round of equity funding.

A Reuters source reveals that New York-based R3, which is leading the working group of over 70 of the world’s major banking and financial institutions, has now lowered its fund-raising target from $200 million to $150 million. The startup is also tweaking “the structure of the deal” according to the publication.

R3’s fundraising blueprint includes creating a new company that delivers R3’s blockchain products to its members, who would share a 90 percent stake in this company. R3 would also run this company for a decade while retaining its stake in the company, along with proceeds from future implementations of its blockchain solutions.


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A select number of banks, with Goldman Sachs and Banco Santander are not investing in this deal, with their lack of interest shown in letting their memberships lapse. Further, the Reuters source reveals that Morgan Stanley and National Australia Bank aren’t participating in the fund-raising deal either. No details if the two banks are opting to renew their memberships were revealed.

New Terms

Still, the source adds that 90 percent of R3’s original 42 member banks are favorable toward investing in the deal, which will run in separate phases over the next 9 to 12 months. The restructured deal offering from R3 sees notable new terms including investing banks acquiring a stake in R3’s development lab, a branch of which is scheduled to open in Singapore.

The original 42 members will be given the first shot at participation in the fundraising round while R3 does not intend to lower its fundraising target any lower than the $150 million. According to the Reuters source, the round will be open to other investors beyond banks such as an unnamed technology company, in the event that the $150 million target isn’t reached.

Solo Blockchain Outings

Like Goldman Sachs’ exit, Santander’s departure from the group is likely to mean a more focused approach to its own blockchain endeavors, rather than the collaborative effort inherent in a consortium like R3. The Spanish banking giant has previously used the Ripple blockchain platform for international payment pilots. The bank has also sponsored this year’s Devcon2 event, a notable nod to backing the public blockchain Ethereum.

Goldman Sachs also continues to be heavily invested in blockchain research and development. The bank is an investor in Digital Asset and with multiple patents filed for its own cryptocurrency and a blockchain solution, the bank was also lead investor in a $50 million funding round for bitcoin startup Circle.

Images from Shutterstock.

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