The crypto industry bet the farm on traditional finance ultimately migrating onto public blockchains rather than retreating behind permissioned networks.

The cows are now coming home to roost for the sector, after its failure to get comprehensive crypto regulation passed in Washington. As the dust settles, it’s becoming clear that banks don’t need a blockchain to be public or private. They need financial infrastructure to be shared where coordination creates value and controlled where regulation requires it.

As tokenized deposits, securities and other real-world assets move from pilots toward production, that distinction is becoming more important as the financial sector’s emerging architecture does its best to avoid bitcoin’s transparent and permissionless model despite the interest in banks of experimenting with shared ledgers and interoperable networks that allow approved counterparties to transact against common infrastructure while retaining control over identity, assets, privacy and settlement.

For example, Fiserv’s digital asset platform went live with financial institution clients on Thursday (Oct. 1), with the Bank of North Dakota using the Fiserv platform’s issuance, reserve, custody and settlement infrastructure to deploy its Roughrider stablecoin token. Elsewhere, Charles Schwab noted in a Sept. 30 analysis that Chainlink now has touchpoints across both crypto-native networks and banks, asset managers and payments companies moving on-chain.

In other words, those finance leaders and banking industry decision makers asking whether public or private chains will “win” finance are missing what the industry is actually building.

The original blockchain proposition bundled several ideas together: a common ledger, decentralized governance, open participation, transparent transaction history and assets capable of moving without a traditional intermediary.

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