The news follows the
long-awaited publication of
the World Economic Forum’s look at how blockchain can reshape the future of our
financial services infrastructure. Among its many findings, it stresses the
need for ‘deep collaboration between incumbents, innovators and regulators’. It
is encouraging therefore to see the emergence of this new consortium and its
subsequent engagement with central banks.
Intro Of Block Chain Technology:-
The blockchain is seen as the main technological innovation of Bitcoin, since it
stands as proof of all the transactions on the network. A block is the
'current' part of block chain which
records some or all of the recent transactions, and once completed goes into
the block chain as permanent database.
Time
will tell what industry standards emerge for digital cash systems, as several
others are being developed. CitiGroup’s ‘Citycoin’, Goldman Sachs' ‘SETLcoin’
and SETL, a London based institutional payment and settlement infrastructure
based on distributed ledger technology, all offer alternatives. The technology
may well experience its own ‘VHS/Betamax’ moment as the market coalesces around
one system. Industry standards will be required in order to ensure
interoperability across different propriety systems, geographies and asset
classes. Existing standards in financial services, around payments, securities
trading and settlement and trade finance may well have to be revised. Despite
the hype surrounding blockchain, debate does remain however as to whether it is
the best model to employ in this field and whether central banks will approve
the proposal for settlements.
In
response to the news, Hyder Jaffrey, Head of Fintech Innovation at UBS
remarked:
“You need a form of digital cash on the distributed ledger in order to get maximum benefit from these technologies. What that allows us to do is to take away the time these processes take, such as waiting for payment to arrive. That frees up capital trapped during the process.”
“You need a form of digital cash on the distributed ledger in order to get maximum benefit from these technologies. What that allows us to do is to take away the time these processes take, such as waiting for payment to arrive. That frees up capital trapped during the process.”
On the
other hand, Founder of UK digital currency, LEOcoin, and Chairman of the LEOcoin
Foundation, Dan Andersson, welcomed the financial sector’s recognition of
the value of block chain technology, but expressed serious concern that the move
could see the world’s biggest banks attempt to “hijack” the sector and crowd
out those working in disruptive finance technology.
“I am
obviously pleased to see the financial world wake up to the value of digital
currency, even if they are late to the party. It is clearly a good thing for
this technology to no longer be treated as a financial pariah reserved for
those with malicious intent. It has the potential to link up businesses and
entrepreneurs on a global scale, and at the LEOcoin Foundation that is what we are trying to do.
“However,
I am concerned that the ‘big banking’ sector’s centralising inclination may
cause them to hijack and stifle blockchain and digital currency technologies to
crowd out disruptive entries. If banks simply use digital currencies to do more
of the same they will have missed the point of this revolutionary opportunity.”
Following
the publication of techUK’s whitepaper focused
on the industrialization of distributed ledger technology in financial
services, authored by members TCS, techUK will be soon convening the first
meeting of its DLT working group. Keep an eye out for associated activities in
the remainder of the year.
Reference:- http://www.techuk.org/insights/news/item/9209-big-banks-collaboration?utm_content=buffer950d4&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
It was great information on blcok chain and virtual currencies.
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