Bitcoin blockchain technology to revolutionize financial services

Most people are familiar with bitcoin as a digital currency. It is believed more than 100,000 companies now accept bitcoin for payment.

Blockchain technology underpins bitcoin transactions in the form of an algorithm that allows bitcoin to be traded without a centralized ledger. The potentially disruptive nature of the technology is that it can also track the exchange of stocks, bonds and other financial securities, and almost anything else of value. Famous venture capital investors like Marc Andreessen compare blockchain technologies to previous tech revolutions like personal computers in 1975 and the Internet in 1993.

Currently, securities are settled using a “closed ledger.” There is a fundamental lack of trust in the process because the buyer wants to know the seller owns the securities and has not transferred them twice. The current securities settlement system requires a three-day cycle, is inefficient and can be systematically unstable if large transactional partners fail. During the financial crisis we learned that the record-keeping infrastructure of the multi-trillion-dollar swaps market was recorded on handwritten tickets faxed nightly to the back offices of market counterparties.

Blockchain technology is based on a distributed “open ledger.” Distributed ledgers use open, decentralized, consensus-based authentication methods unlike

Read more ... source: TheBitcoinNews

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