A new report from the Bank of International Settlements (BIS) has outlined three possible use cases for blockchain technology in the industry.
While conceding that blockchain and digital ledger tech (DLT) hold great promise, the paper argues that most projects are in the proof-of-concept phase and will require additional time before going mainstream.
“The first wide-scale use of distributed ledgers in payments is likely to be years away, as technological, legal and other hurdles will need to be overcome,” according to the work.
The paper, titled “The Quest for Speed in Payments“, explains the three main areas of blockchain innovation as securities settlement, cross-border payments and bank-issued digital currencies.
Securities settlement has traditionally been a slow process, the multiple-day process of money changing hands could be reduced significantly by the incoming tech, according to authors who state:
“If DLT arrangements could provide real-time or near realtime settlement of the securities and associated funds transfer on the trade date, the cost savings could be significant. It would reduce record-keeping and reconciliation costs, as well as settlement costs, by eg eliminating the use of collateral to guarantee the exchange of securities and cash.”
Blockchain enabled innovation in the securities settlement space is already being
Read more ... source: CoinDesk
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