Delaware is looking to use blockchain technology in a bid to streamline the cost and paperwork burden of registering new companies in the state.
In partnership with smart contract-focused startup Symbiont and New York law firm Pillsbury Winthrop Shaw Pittman, the planned system would move the process of registering companies, tracking share movements, and managing shareholder communications into a digital environment.
At present, Delaware is in the initial phases of the project. Before any companies starts registering via blockchain, deliberations with the state’s bar association await, and possible tweaks to state law may need to be made. There is also the question of whether the bitcoin blockchain will be utilized as part of the proposed process.
Delaware Governor Jack Markell spoke about the initiative at the Consensus 2016 blockchain conference, telling attendees that the state had no current plans to pursue a licensure scheme for digital currency companies, a nod to the BitLicense created and launched in New York.
Notably, Markell said that the government would push for the creation of a new type of corporate shares, dubbed “distributed ledger shares”.
He told attendees:
“Distributed ledger shares hold the promise of immediate clearance, immediate settlement, and bring about dramatic increase in efficiency and speed and an increase in commercial transactions of which Delaware is known.”
The project traces back to efforts in the mid-2000’s, when Delaware legislators amended state law to begin digitizing the state’s largely paper-based system for registering companies and tracking the sale and movements of shares.
Other blockchain initiatives currently being pursued by the state include a project with the Delaware Public Archives, for which Symbiont is developing a system for storing archival records digitally.
“Autonomous record-keeping is an important use case for how smart contracts can deliver a more transparent, efficient and level playing field to the public and private sectors,” Symbiont CEO Mark Smith said in a statement.
Delaware’s government is expected to pursue other applications of the technology, and according to Markell, the project will result in the creation of a so-called “Delaware Blockchain”.
Photo by Michael del Castillo for CoinDesk.