In May, Bitcoin Magazine reported that the leading stock exchange Nasdaq would begin experimenting with the blockchain technology that powers Bitcoin. In June, Nasdaq announced a partnership with San Francisco-based Bitcoin API startup Chain to implement the first blockchain technology pilot projects in Nasdaq Private Market, a recently launched marketplace that handles pre-IPO trading among private companies.
In a recent analysis, the prestigious MIT Technology Review notes that, though it’s much too early to tell whether bitcoin is the future of money, the Nasdaq experiment will test whether it can be the future of financial record-keeping.
In the Nasdaq Private Market pilot project, record-keeping via the blockchain will complement a cloud-based data management tool that tracks who owns shares of a given company, and how much they own. Besides the existing record-keeping tool, corresponding entries in the blockchain will contain certain important information about the transaction, such as the timing and number of shares involved.
Errors in financial record-keeping can be costly. “There’s really no great system in place to ensure that this is done accurately along the way and is auditable to the beginning of time,” said