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TheWorldDominationofBlockchainArticlePrintVersionbobsguide.com

TheWorldDominationofBlockchain
6June2016
Could2016betheyearoftheblockchainboom?Withreportsofbanksandbankersactuallyusingthe
technology,thereisachancethatnegativeattitudestowardsblockchaincouldbedispelledinthenearfuture.
DominantfintechstartupSETLannouncedlastweekthattheyhaveusedthistechnologytocreateaplatform
wherebothbuysideandsellsideinstitutionscantradeonaprivateandsecurenetwork.PeterRandall,CEOand
cofounderofSETLtoldBusinessInsiderthatatthemoment,blockchainisalltalk.Whatitsreallyresponding
toisthefacttherearealotofpeopleouttheretalkingaboutitbuttheyretalkingaboutitbecausetheyhavent
actuallygotanythingtoshow.Wehavebothanenormousamountofexperienceinhowtolaunchprojectslike
thisbutalsoanenormousamountofexperienceintermsofactuallyhavingworkingprototypes,Randallsaid.
WithSETLnowbeingabletoconducttensofthousandsoftransactionspersecondandbillionsoftransactionsa
day,bankswouldbesillynottojumponblockchainwagon.Whilemanyare,riskisanunderlyingconcern,asit
iswithanynewtechnologyorproduct.bobsguidespoketoMaxSpeur,chiefoperatingofficeratSunTec
earlierthisyearaboutthedigitalisationofbankingandheexploredhowcorebankingsystemscouldbethe
lynchpinintheevolutionofbetterserviceforcustomers.However,withmanyreportsrevealingthatblockchain
canofferasecurealternativetocurrentsystems,thiscouldalsobewhatisneededtokeepdatathreatsatbay.
IseeblockchaintechnologycateringforanichemarketbecauseIdontthinkthatitiscapableofprocessing
highvolumetransactions,butthetechissecure,Speursaid.WiththeUKgovernmentsadvocacyof
blockchaintechnologyintheUKFintech2020manifestoreleasedbyInnovateFinanceearlierthisyear,the
countryissettounlockthefullpotentialofthistechnology.SirMarkWalport,chiefscientificadviserto
theUKGovernmentdetailedhowthecurrentdatamanagementsystemsarelargecentralisedsystems
withahighcostsinglepointoffailure,andthishastochange.
Distributedledgersareinherentlyhardertoattacksbecauseinsteadofasingledatabase,therearemultiple
sharedcopiesofthesamedatabase,soacyberstackwouldhavetoattackallthecopiessimultaneouslytobe
successful,SirWalportsaidinthegovernmentreport.BusinessInsiderexplainsthedifferencebetweenthe
currentdatabaseinfrastructureandthenewblockchainversionasthedifferencebetweenWordandGoogle
Docs.Thetechnologyusescomplexcryptographytostoppeoplechangingtransactionsoncetheyvebeen
signedoffbymembersofthenetwork,thereportread.
InadditiontotheUKgovernment,theFinancialServicesRegulatoryAuthority(FRSA),partoftheAbuDhabi
GlobalMarket(ADGM)isplanningtoformafintechsandboxwherestartupswouldbeabletooperateundera
flexibleregulatoryframework.Thepaperontheannouncementstatesthattheauthorityintendstobuilda
conducivefintechenvironmentinAbuDhabiandpositiontheADGMasafintechhub.Alongsidethis,thepaper
impliesthatblockchainstartupsareencouragedtojointheprogrammeastheprojecthasthepotentialtopromote
significantgrowthandefficiency.
Theadventofroboadvisersthatofferlowercosts,simplicityandrealtimeportfolioanalyticsandmonitoring
orleveragingontheapplicationofblockchaintechnologyanddistributeddatabasestofacilitateprice
discovery,smartcontracts,settlementoffinancialtransactions,etc.thatmayleadtosafer/betterproducts,and
higherproductivityandgrowth,thereportread.AccordingtoCoindesk,aUAEbasedcommercialIPlawyer
withSimmons&Simmons,RazaRizvibelievesthatthisenthusiasmforblockchainistoattractenterprise
financialinstitutions.
NodoubtthetwoindependentinitiativeswillbringoutthebestineachotherandenabletheUAEasawholeto
leadthewayinthefintechsectorandusageofblockchaintechnologyintheMiddleEast,Rizvisaid.
BlockchainhasalsomadeanimpactinotherpartsoftheworldasChineseinsurancefirmPingAnhavejoined
theR3blockchainconsortiumtojoinotherfinancialinstitutionsinthemissiontocreatestandardsforthe
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technology.CEOofR3DavidRuthersaidthatthisisanimportantmilestoneforbothcompaniesandtheglobal
markets.
WiththechairmanofSETLbeingSirDavidWalker,whoistheformerexecutivedirectoroftheBankof
England,formerchairmanofBarclays,formerchairmanofMorganStanleyInternationalandformerdeputy
chairmanofLloyds,thisindicatesthatbankersareinterestedinblockchain.Abetterexamplecanbefoundin
BlytheMasters,CEOofDigitalAssetHoldingsandformerseniorexecutiveatJPMorgan.AtMoney2020
Europe,shespokeabouthowblockchainisalwaysasubjectthatleavespeoplethinkingtheyalotaboutthe
subject,butaftertheyveprocessedwhattheyvebeentold,theythinktheyknownothing.
Masterspredictedthatwewillseethistechnologybeingdeployedinacommercialsetting,butitwillbeyears
beforeitbecomesmainstream.Thetechwillalsoofferopportunitiestoregulatorsastheywillhaveadirect
windowtothesharedledger,sowiththis,theyarealreadyarmedwithincrediblepower.Mastersalso
comparedtheadventofblockchaintothatoftheinternet.Whatcameoutoftheinternetwereafewbehemoths
andafewdeaths,butthevastmajorityofcompanieshadtoadapt.Whatthisrevealedwasthatblockchainwill
dominatethefinancialindustryinthenearfuture,andbanksandotherorganisationswillhavetoadaptasa
result.Thefinancialindustryisalargeoceantoboil,butblockchainischangingtheworldaswespeak.
SantanderarealsoexperimentingwithblockchainandclaimtobethefirstUKbanktobetriallingitinan
iPhoneappwhichreducesthecashtransfertimebydays,accordingtoCityAM.SinceSantanderInnoVentures
investmentinstartupRipple,thebankhasbeenworkingonhowthedigitalledgercanbeusedinfinance.The
needforfinancehasevolvedfromprovidingaphysicalpoundinyourpocketorcardinyourpurse,whereyou
payatatill,tobeingseamlesslyintegratedintoanew,alwayson,connectedlifestyle,SiggaSigurdardottir,
headofcustomerinnovationatSantandersaid.
bobsguidespoketoSantanderInnoventuresbossMarianoBelinkyabouttheblockchainbuzz.Therewas
abitofatransitionaroundSIBOS2014whenpeoplestartedhavingbetterconversationsaboutdigital
currenciesbutalsotheunderlyingtechnology.ThentheTreasurycameoutwithapaperencouragingbanksto
lookatdistributedledger.Upuntilthenbanksthoughtitwastooriskytogetinvolved.R3cameaboutandthe
wholethingstartedacceleratingthroughout2015.

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