Blockchain - Beyond the hype?
(11 August 2020 – Global) With economists telling us that innovation and digital solutions could offset the more pronounced longer-term impact of COVID-19, much needed widespread adoption of new technology such as Blockchain seems some way off.
East & Partners echoed this sentiment in the recent Research Note ‘Blockchain – a Solution Looking for a Problem?’. Despite this, the financial services industry seems to have moved beyond the hype and is quietly ‘getting on with it’ according to Deutsche Bank.
In banking, where building trust and ensuring transactions have transparent and accurate information are paramount, the technology would appear to be an ideal solution. Yet despite all this potential, no leading players have really emerged for investors and a profitable, scalable application still seems years away. Blockchain is far more than just a tool to be used within the financial services industry. Indeed, the most immediate impact of distributed ledger technology (DLT) won’t be seen here, but in other, less regulated industries such as energy, supply chain management and the insurance sector.
While innovation in the sector looks set to continue, and pockets of activity will be seen in trade finance where the participation works for that particular community, we are still some years away from full adoption. Could the pandemic be an accelerator? And could trade lead the way? Nothing is impossible.
"We keep watching the ecosystem and remain open for engagements if and when we can see that industry standards start emerging" said Deutsche Bank Head of Trade Finance Product Management, Kirsten Kunz.
"Digital ecosystems have the potential to promote the sustainability agenda of many participants in international trade" stated Standard Chartered Global Head of Trade, Michael Spiegel.