The big banks are taking baby steps toward commercializing blockchain – some major financial institutions have been testing blockchain in small-scale projects for years. But they have yet to launch any major blockchain initiatives.
Now, some of the biggest banks are starting to work together on blockchain projects with the potential to be commercially viable. JPMorgan, HSBC, ING, and eight other banks have joined forces to create a blockchain platform for trade finance.
For you, it would be sensible to find best crypto broker before getting involved in this exciting new technology. With such a plethora of projects, a broker will be able to provide you with advice on which blockchain projects are worth investing in.
The benefits of commercializing blockchain
Commercializing blockchain could help banks save billions of dollars every year.
According to a report by Accenture, banks could save up to $8 billion a year by using blockchain to streamline the process of settling trades. The report estimates that the current system for processing and settling trades is slow, outdated, and inefficient.
Blockchain has the potential to speed up the process by reducing the need for manual verification and reconciliation. The platform would also allow for real-time visibility of all trade activity, which would help reduce risk.
Another benefit of commercializing blockchain is that it could help banks comply with new regulations. For example, the European Union’s General Data Protection Regulation (GDPR) requires businesses to protect the personal data of customers.
Blockchain could help banks meet GDPR requirements by allowing customers to control their own data. Customers would be able to grant or revoke access to their data as needed. This would give customers more control over their privacy and allow them to share only the information they want to share.
Banks are already exploring ways to use blockchain. In 2016, a group of banks, including HSBC and Barclays, completed a successful test of a blockchain platform for trading derivatives. The test showed that the platform could reduce the time it takes to settle trades from days to hours.
There are still some challenges that need to be addressed before blockchain can be fully commercialized. For example, the technology is still new and there are concerns about its scalability. But with the right regulations in place, blockchain could revolutionize the banking industry.
The drawbacks of commercializing blockchain
While there are many potential benefits to commercializing blockchain, there are also some drawbacks that need to be considered. First, as with any new technology, there is a risk that it will not live up to the hype. Second, blockchain is still a relatively new technology and it remains to be seen how well it will stand up to the rigors of large-scale use. Finally, there are concerns about the security of blockchain platforms, as they have been targeted by hackers in the past.
Despite these challenges, commercializing blockchain is a high priority for many banks and other financial institutions. With the right regulations in place, blockchain could help to reduce costs, speed up transactions, and make the banking system more efficient.
When will the commercialization happen?
Banks and other financial institutions are already investing heavily in blockchain technology. However, it will still take some time for the technology to be fully developed and ready for widespread use. In the meantime, banks are working on pilot projects and experimenting with different ways to use blockchain.
It is expected that commercializing blockchain will happen in stages. First, smaller banks and financial institutions will start using the technology. Then, if everything goes well, larger banks will follow suit. Finally, once blockchain is proven to work on a large scale, it could be adopted by all banks and other financial institutions.
The commercializing of blockchain is likely to happen within the next five to ten years. However, it is possible that it could take longer for widespread use. In the meantime, banks are working on pilot projects and experimenting with different ways to use blockchain.
It is expected that commercializing blockchain will happen in stages. First, smaller banks and financial institutions will start using the technology. Then, if everything goes well, larger banks will follow suit. Finally, once blockchain is proven to work on a large scale, it could be adopted by all banks and other financial institutions.
The commercializing of blockchain is likely to happen within the next five to ten years. However, it is possible that it could take longer for widespread use. In the meantime, banks are working on pilot projects and experimenting with different ways to use blockchain.
Conclusion
The potential of blockchain is huge. It has the potential to revolutionize the way we do business and could have a major impact on the global economy. However, it will take time for the technology to be fully developed and adopted. In the meantime, banks are exploring ways to use blockchain and are working on pilot projects.
