Envisioning Bitcoin’s Technology at the Heart of Global Finance
Aligning with fintech (financial technology) as the most anticipated vertical in the startup industry, Bitcoin’s technology called “Blockchain” touted could change the way banks work and the future of global financial system. A new report by the World Economic Forum clearly states the financial industry needs Blockchain technology.
The study, which was based on a year of research and discussions with financial institutions around the world, notes that 80 per cent of banks are expected to start these projects in 2017 and that more than 90 central banks are currently discussing the use of the technology.
Bitcoin’s hype maybe not as high as it first came up. But the database where all Bitcoin transactions are recorded and stored, blockchain, will fundamentally alter the way financial institutions do business around the world.
Also known as Distributed Ledger Technology (DLT), the unique characteristics of the Blockchain makes it impossible for it to be ignored. Rather, it presents a platform where other concepts and technologies can build upon, especially within the global financial system.
Contradictary to existing financial ledgers or databases used by banks and other institutions, the Blockchain is updated and maintained not by a single company or government. Instead it is run by a network of users. It’s similar to the way Wikipedia is maintained by users around the globe.
Though the usage of this novel technology may not be visible on the surface, new processed and architecture based on the blockchain will help simplify back-end processes. However, the report also opposes the idea of embracing Bitcoin or radical fintech innovation, which is rather strange.
Aside from that, we think this Blockchain technology is may seems more likely to be accepted by Bank Indonesia as the central bank here. Since it should be viewed as one of many technologies that will form the foundation of next‐generation financial services infrastructure.