Blockchain for the Finance Industry – Troy’s Take

Blockchain for the Finance Industry – Troy’s Take

Blockchain Rookies > Blog > Troy Norcross > Blockchain for the Finance Industry – Troy’s Take

Blockchain for the Finance Industry – Troy’s Take

A recent Telegraph article by investment commentator Garry White makes the bold claim that Blockchain ‘’will change the financial world forever’’. The technology, he states, could bring massive operational change in the coming years. The article discusses several solutions that Blockchain technology could offer to the financial sector, from the ability to effectively set negative interest rates to removing the heavy reliance on major banks.

Blockchain Rookies founder Troy Norcross gives his expert opinion on what Blockchain means for the finance industry, and he agrees that the impact could be huge. ‘’The finance industry is having their first major shakeup in how they operate’’, he says.

White’s Telegraph article, in its evaluation of the effect of Blockchain, discusses the transparent approach of a Blockchain banking solution. Because Distributed Ledger Technology (DLT) allows users to verify or deny transactions, there are uncertainties surrounding the place of banks if it is implemented. ‘’A lot of the financial IT infrastructure will change – and the role of banks will change,’’ Troy says, ‘’but they aren’t going away.’’

As with any radical industry shift, there are questions regarding its impact on workers. One of DLT’s key benefits is that the ‘middle-men’ who authorise transactions would no longer be necessary, however this raises concerns surrounding employees in this field. ‘’The role of facilitating transactions,’’ would be replaced by the technology, Troy says, but points out that ‘’the role of financial advisor, broker, dealer and all of those other functions will remain the same.’’ Though the financial industry would be greatly altered, the majority of the sector’s employees would simply adapt their roles with the technological shift.

White’s article discusses the potential risk that Blockchain poses to banks, and how closed Blockchains, where only those with permission can access the network, could provide a more attractive alternative than an open Blockchain. He reasons, however, that any such closed Blockchains may not be allowed by regulation. ‘’Closed Blockchains do exist,’’ Troy points out, and suggests the regulation may not be as severe as suggested. ‘’The regulator may look at how the companies interact, but it is unlikely they will regulate the technology they use to interact.’’

Blockchain provides a way for companies to reduce costs while increasing efficiencies and reducing the risk of data fraud, White says. Banks, however, are likely to meet the transformation with caution, but do they really have something to worry about? Troy explains the risks banks would face if the cryptocurrency space were to replace traditional currencies. ‘’They could lose the ability to apply monetary controls – plus they could lose control over interest rates. And governments could lose control over their ability to monitor and apply tax.’’

White admits that though people are certainly taking notice of Blockchain, a shift as major as a digital currency is likely to be several years away. Troy agrees, commenting that Blockchain is still in ‘’very early days in its evolution’’, but is confident in its future impact. ‘’I do think it will be 3-5 years before we see anything mainstream. But there will be other early implementations in 1-2 years.’’

Source: https://www.telegraph.co.uk/business/2017/11/16/blockchain-will-change-financial-world-forever/

Learn more about how Blockchain could be implemented into your business. Contact troy@blockchainrookies.com.

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