Future of the Blockchain for Banks and Financial Institutions

Years before the internet became what it is today, sceptics claimed it wouldn't work.

In 2017 there's increasing evidence blockchain based smart contracts that negotiate shared memory with DLT technology (distributed ledger technology) may be the key to the future of finance, and banks are starting to take action.

We've reached an unprecedented tipping point where Blockchain platforms such as NEO and Ethereum can scale the blockchain not just to financial institutions but to a wide range of business industries and case scenarios.

Bitcoin and regulation around ICO (initial coin offerings) are pushing National central banks and groups of banks to think of how to integrate with existing crypto currencies and perhaps, create their own.

The idea of decentralized systems and interoperable open protocol layers are more trustworthy to Millennials.

Just 8 years after the founding of the cryptocurrency Bitcoin, we've come a long ways and before 2025, we may witness the transformation of the entire global financial system to the blockchain.

Utility Coin Settlement - Banks Join Together

This would help automate financial transactions while creating more affordable banking alternatives for financial service consumers. How can financial institutions integrate with emerging cryptocurrencies? An example of this is the Utility Settlement Coin (USC) project established in 2015.

It's up to 11 banks and financial institutions and should be up in running in early 2019. At the same time initiatives in China and India could see national crypto-currencies coming into effect.

However, Blockchain is not for the legacy financial order but for those banks, countries and financial institutions that are forward looking and want to sync with the values of their younger customers while benefiting from increased security.

The USC is just one experiment of financial institutions becoming more flexible to cryptocurrencies, but NEO or Ethereum could scale faster and prove more relevant to the future of the Blockchain.

Many ICOs that gained public interest were built upon Ethereum. The ICO boom along with a growing popularity of Bitcoin have shown much public interest of late on the fate of crypto currencies and that which underpins them, blockchain.

As certain as the proliferation of robots, the automation of jobs in the workforce; so too does the blockchain loom as a transforming paradigm of the Earths' future.

Fate of Blockchain may reside in China

The China ban on ICOs and closing of cryptocurrency exchanges of late 2017 meant more mainstream blockchain systems were thrust into the spotlight as Bitcoin still suffered from a poor reputation and lack of adequate regulation.

Could China shutting down the foreign influenced blockchain economy be the strongest signal yet of any Nation state that it's building its own fiat cryptocurrency to rule them all?

People’s Bank of China (PBOC), China's central bank is a likely candidate as China is a FinTech leader with a very forward looking government when it comes to the intersection of tech and the economy.

China based NEO, formerly called Antshares, could challenge Ethereum as the winning blockchain-as-a-service platform (BaaS). This is because in go-to-market, even as something as obscure as smart contracts, China's superiority is becoming evident.

Could NEO Eclipse Ethereum?

The World Economic Forum predicts that  10 percent of the world’s GDP will be stored with blockchain tech in 10 years’ time — representing a $7.8 trillion value in today’s prices.

Founded in 2014, NEO is China's first ever open source blockchain. Founded in 2014, NEO’s mission has been to reinvent the way commerce is done. We believe technology drives progress and together we can create the future. Motivated by this, NEO has been created to shift our traditional economy into the new era of the Smart Economy.

The era of banks and financial institutions creating blockchain-based proofs of concept (POCs) in partnerships with FinTech companies is helpful, but what happens when big players switch to the blockchain? We may be about to find out.

While nearly every global bank is experimenting with blockchain technology as they try to unleash the cost savings and operational efficiencies it promises to deliver, we may be in the midst of a blockchain revolution where the stakes are high for the future of banks and financial services.

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