PWC’s Global Fintech Report 2017 shows that 77% of Fintech executives expect to adopt blockchain as part of an in production system or process by 2020. In other words, it’s moving “out of the lab” and into day-to-day systems.
It is still early days for many, though. The report also reveals that nearly one third of respondents in banking say their firm is in the early stages of evaluating blockchain strategy and potential partnerships.
On the one hand, blockchain technology could lead to greater automation in bank transfers. On the other, there is potentially no need for a third-party intermediary – such as a bank or other FS firm.
“Peer-to-peer currencies could completely transform the financial industry,” says Grégoire Tondreau, Managing Partner at Roland Berger. “But banks are yet to decide if this technology is friend or foe.”
For Daniel Sale at Telr, the technology offers opportunities, not challenges.
“We’re very bullish about blockchain. There are hurdles to get over – cost, processing, energy requirements – but blockchain is here.
“There’s apparently an insurance company in India that puts its travel insurance customers on to a blockchain. It pulls all the live departure information on to the same blockchain so when it understands a client has a delayed flight, it will automatically pay them the compensation that’s due under their travel policy – without them having to lodge a claim with the insurance company.
“There’s potentially massive use in things like cross-border transactions where you can reduce processing time down from days to seconds.
“I completely understand why people might say it’s just words in the sky. But the fact is, I do see banks quietly getting on with blockchain. Particularly with cross-border transactions and companies like Ripple. Santander, for example, agreed a deal with Ripple a couple of months ago. And they’re potentially one of dozens doing so.”
Whether it’s truly time for blockchain’s breakthrough into the FS mainstream or not, there is a clear effect taking place on the jobs market. According to Bitcoin Magazine, the number of blockchain-related LinkedIn jobs postings has more than tripled over the last year.
Whether reactive or proactive, this investment in blockchain expertise suggests that FS firms need to at least be up to speed with the technology – if not yet diving in fully.