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Blockchain to become 'beating heart' of financial system 

August 17, 2016


Blockchain technology will fundamentally alter the way financial institutions do business, according to a report from the World Economic Forum. However, the effects will be hidden, coming from new processes and architecture based on blockchain that simplify back-end processes, making them cheaper, more secure and more accessible, rather than radical fintech innovation or new currencies such as bitcoin, says the WEF.

Based on 12 months of research and interviews with more than 200 industry players, the 130 page report explores how distributed ledger technology will affect insurance, payments, market provisioning, investment management, capital raising, and depositing and lending.

Among the main areas ready for disruption are international payments and wire transfers, rehypothecation, or the repackaging of mortgages, and compliance reporting of banks to regulators.

The report also highlights the potential for an inter-bank, blockchain-based fiat currency to streamline the arduous process for transferring money, an innovation which would "cause blockchain technology to enter the finance bloodstream". Read more

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