By Gary Wright
Oct 19, 2015
Blockchain is gaining so much interest as we can see from the many daily announcements of some new ideas and investing in the technology reaching gold rush proportions. I wonder how many are following the dream but with no reality involved. Don’t get me wrong Blockchain is potentially one of the most interesting technologies of recent times and holds significant possibilities to change market infrastructures as well as those in-house at banks. Its just that most of these ideas are starting half way up the ladder and without firm foundations cementing a steady climb.
Having created a pilot Blockchain solution that has potential to resolve the problems in processing is one thing but creating the case for change is something else.
Its important that firms going down a Blockchain road first understand what it is they are trying to solve. Many technologists will be in love with the possibilities afforded by the technology without the necessary understanding of the business or underlying processes and systems that support it. This gap will broaden to a chasm unless a clear focus is introduced with a definite outcome.
Assuming the idea holds water the introduction of a Blockchain project should be strategic and non invasive. The danger is the implementation of Blockchain into existing environments could totally upset the apple cart. Blockchain is still finding its feet and the risks are high for first movers. However once the risks has been assessed and a project started the possibility of totally restructuring Post-trade is almost limitless.
Despite the many millions that has already been invested by banks into fintech startups the day is only at dawn for Blockchain. There must be far more education of the operational business people about Blockchain benefits if the revolution is to progress with pace. The case for Blockchain can only be made at a strategic level and should be based on business benefits and client services in my view. Their are numerous other benefits but these two offers the best starting point.
Forget the Blockchain Gold rush its now time for some sober and creative thinking by good thought leaders in Post-trade operations.