Blockchain tech has been explored by a number of banks and financial institutions in the past few months, but the news that nine of the biggest names in the industry are teaming up to work on this initiative marks a huge leap forward. Among the group are JPMorgan, Goldman Sachs, Barclays, UBS, and Credit Suisse.
In line with this, the group will be working with a blockchain tech startup called R3CEV, which is a New York-based company comprised of trading and technology executives.
Blockchain Tech in Finance
Blockchain refers to the distributed public ledger of bitcoin transactions that is updated by a network of computers solving complex algorithms in a process known as bitcoin mining. It is decentralized in nature and is a consensus-based decision-making model, which means that the entries on the blockchain cannot easily be altered unless majority of the computers storing the ledger are also accessed.
With that, several firms and even governments have tapped into the potential of blockchain tech in terms of record-keeping, asset ownership changes, and trade settlement. Overstock has pioneered the application of blockchain technology in trade settlement, allowing Wall Street establishments to complete transactions at lower costs and at shorter spans of time.