Today’s announcement of the Token Taxonomy Initiative (TTI) is a milestone in the maturity of the blockchain industry.
The initiative brings together some of the most important blockchain platforms from the Ethereum ecosystem, Hyperledger and IBM, Intel, R3, and Digital Asset in a joint effort to establish a common taxonomy for tokens. Also joining are other standards bodies like FINRA, enterprises like J.P. Morgan, Banco Santander, and ING and companies pushing the boundaries in blockchain like ConsenSys, Clearmatics, Komgo, Web3 Labs, and others.
Over the past year, the Azure Blockchain engineering team has been working to understand the breadth of token use cases and found that a lack of industry standards was driving confusion amongst our enterprise customers and partners. We started building the Token Taxonomy Framework to help address this confusion, establish a base line understanding, and a path forward for our customers and partners to begin exploring use of tokens. We quickly realized that our efforts would be much more effective if we didn’t work in isolation, so we chose to contribute the framework and partner with our counterparts across the industry to expand the TTF and seed the industry with a common standard. As the Principal Architect for Azure Blockchain and an EEA Board Member, I will represent Microsoft in the release of the 1.0 framework and will act as the chair of the TTI, collaborating with all participants to ensure that the outcome establishes a foundation to rapidly accelerate the token economy.
A core principle driving this initiative is platform neutrality, which will ensure the standards we outline are agnostic to any company and empower the industry to innovate openly. This workgroup brings together a diverse set of thought leaders from across the blockchain community, including public cloud platforms, blockchain start-ups, and early adopters across industries. Each of us recognize both the power of the token economy and the challenges facing businesses looking to innovate in this nascent space. We hope that our initial work seeding the Token Taxonomy Initiative will provide a starting point for the community to build upon in the coming month by providing:
- A definition of tokens and their use cases across industries.
- A common set of concepts and terms that can be used by business, technical, and regulatory participants so they can speak the same language.
- A composition framework for defining and building tokens.
- Create a Token Classification Hierarchy (TCH) that is simple to understand.
- Tooling meta-data using the TTF syntax to be able to generate visual representations of classifications and modeling tools to view and create token definitions mapped to the taxonomy eventually linking with implementations for specific platforms.
- A sandbox environment for legal and regulatory requirement discovery and input.
While not specific to the Ethereum family of technologies, this work does draw from the working group’s experience building with the Ethereum ecosystem. As chair of the TTI, I invite everyone to participate and learn about the taxonomy as it is rolled out in the coming months and look forward to the continued innovation in this space.