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Financial services firms maintain their faith in the potential benefits of blockchain, with firms operating in securities services the latest group to express their belief in the technology in a new survey conducted by Deutsche Bank.
The study, which surveyed 200 institutional investors, banks, financial sponsors, brokers, and sovereign wealth funds, found that 87% of respondents believe that blockchain technologies will have a significant impact on the securities services market.
Here are some of the study's key findings:
There are still hurdles to overcome before we see widespread adoption of blockchain in securities services. That includes the need for real-world examples of blockchain delivering the benefits it promises and a network of users committed to the same system. In order for these hurdles to be overcome within the six years that industry players expect, firms will have to work together, as it seems unlikely any one entity will be able to create a system acceptable to all.
Blockchain technology, which is best known for powering Bitcoin and other cryptocurrencies, is gaining steam among finance firms because of its potential to streamline processes and increase efficiency. The technology could cut costs by up to $20 billion annually by 2022, according to Santander.
That's because blockchain, which operates as a distributed ledger, has the ability to allow multiple parties to transfer and store sensitive information in a space that’s secure, permanent, anonymous, and easily accessible. That could simplify paper-heavy, expensive, or logistically complicated financial systems, like remittances and cross-border transfer, shareholder management and ownership exchange, and securities trading, to name a few. And outside of finance, governments and the music industry are investigating the technology’s potential to simplify record-keeping.
As a result, venture capital firms and financial institutions alike are pouring investment into finding, developing, and testing blockchain use cases. Over 50 major financial institutions are involved with collaborative blockchain startups, have begun researching the technology in-house, or have helped fund startups with products rooted in blockchain.
Jaime Toplin, research associate for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on blockchain technology that explains how blockchain works, why it has the potential to provide a watershed moment for the financial industry, and the different ways it could be put into practice in the coming years.
Here are some key takeaways from the report:
In full, the report:
To get your copy of this invaluable guide, choose one of these options:
The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of blockchain technology.