Corporate Finance, DeFi, Blockchain, Web3 News
Corporate Finance, DeFi, Blockchain News

Blockchain: wisdom of crowds begins in blind competition

Blockchain, the technology underlying bitcoin, is coming to a back office, and clearing house, and bank, and front office near you. Instead of one authority keeping records, everyone will. That’s the idea, anyway, of a wave of start-ups rushing to build workable applications. How will clarity emerge from this ferment, and just how will it change the business of debt capital markets? Jon Hay reports.

Have you ever wondered why, when you pay for something with a debit card, your bank can verify and accept the transaction in seconds — yet the money doesn’t actually leave your account for a couple of days?

Or why you can trade shares or bonds instantly — sometimes in microseconds — but settlement will not happen till days later?

Instant global communication has been possible since the days of the telegraph — and in highly sophisticated ways, for decades. If trading messages can be sent, money can move.

Yet the clearing and settlement systems we are using to move money and assets around seem to belong in the 1970s.

It is easy to see why. The gain to be had from updating them has never been great enough to justify the enormous effort of reform. There have always been more important things to do.

But a technology has come along now that is grabbing the attention of financial leaders, and inspiring them to grand predictions about how all the plumbing of the system is going to be transformed.

Blockchain — the highly complex form of communication between computers that underlies cryptocurrencies like bitcoin — was the most hyped financial buzzword of 2015, with everyone from Jamie Dimon to bearded tech hipsters lauding its potential.

Bitcoin itself had enjoyed the glow of celebrity...

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Vendredi 8 Janvier 2016