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Blockchain Technology Could Save Banks $12 Billion a Year (silicon.co.uk)
Mickeycaskill quotes a report from Silicon.co.uk: Accenture research has found Blockchain technology has the potential to reduce infrastructure costs by an average of 30 percent for eight of the world's ten biggest banks. That equates to annual cost savings of $8-12 billion. The findings of the "Banking on Blockchain: A Value Analysis for Investment Banks" report are based on an analysis of granular cost data from the eight banks to identify exactly where value could be achieved. A vast amount of cost for today's investment banks comes from complex data reconciliation and confirmation processes with their clients and counterparts, as banks maintain independent databases of transactions and customer information. However, Blockchain would enable banks to move to a shared, distributed database that spans multiple organizations. It has become increasingly obvious in recent months that blockchain will be key to the future of the banking industry, with the majority of banks expected to adopt the technology within the next three years.
What could possibly go wrong...
Blockchain - worth billions.
Did any bank invent it? nope.
Innovation does not come from encumbents.
I remember, back in the day, when ATMs were first proposed. They would save the banks soooo much money. They could have fewer employees since now their customers could get to their money whenever they felt like it. There would be less paperwork, shorter lines, the benefits were endless.
Which is why you are now charged to get your own money if you're not using your own bank's ATM.
I wonder what money-grabbing scheme banks will implement if they start using blockchains?
Unless I own a bank, it's not like I, as a regular consumer, will see any benefit. The savings are all going to go into the pockets of a few fats cats who don't really need the extra money anyway.
In case you don't remember, the last time a brilliant silicon valley idea to speed up bank transactions was implemented on a massive scale, it directly led to massive mortgage fraud that was an important factor in destroying the economy in 2008 and leading to the Great Recession. I refer to the robo-signing scandal where some folks decided the old fashioned way of doing mortgages was too slow, so why not have bank employees just use a computer to rubber stamp mortgage paper work and overlook all those little details like "can this person making minimum wage afford $10,000 a month mortgage"
The reason banks do things a certain way is not because they hate innovation, it's because the number one job of a bank qua bank is to be dependable and reliable method which value can stored and transferred between parties. Yes all the other stuff about profit etc is true, but even communist countries have banks for the reason i stated.
I know people love cutting costs but when you cut costs so much that you have a bunch of tech guys handwaving a technology that is at the fundamental core of what banking is, to the business guys who don't understand it, then the consumers are about to get left out of the system, and the taxpayers probably don't want to do another bailout of banks like they did in 2008. And let's face it - most tech people do not even understand block chain. Ask them to explain the Bitcoin chain fork for example.
This is about investment banking, not the retail banking most of us use. You remember investment banks, don't you? The ones that were too big to fail a few years ago after branching out into areas with little or no regulation?
Wow, what a great idea! (irony). Literally one database corruption (see recent pot data corruption posts) could wipe whole nation's savings.
Is that Accenture web page trying to be like E News or something?
I tried to find some substantial information and all I got was snippets that said nothing by hype.
Blockchain Technology Could Cost Banks $12 Billion a Year
If blockchain was this hot banks would already be doing it on their own and Accenture wouldn't be writing whitepapers trying to sell it.
Bitcoin/litecoin/dogecoin/etc attempt to solve the trustless peer to peer model.
A multi-bank blockchain implementation would not use a trustless model, it would be a trusted model where the sender and receiver both sign the transaction, and it is then added to the blockchain for consumption by all participating banks.
It's a way to share an immutable (without retracting ALL transactions before the transaction to be deleted) ledger, in this case between trusted parties.
all banks are now regulated to some extent, there is no more traditional 'investment bank' as it existed in the 80s and 90s. i mean they will mutate a lot but the legal entity and legal framework does not exist anymore. it has changed
Loan approval is a completely different application from transaction processing.
The problem with block chain tech is it's about popularity and this favours places like India or china which could outvote your local small country by simply numbers.
So who do you trust the banks or some new block chains run by who knows what in some who knows where country....
Would be interesting to see billions of Muslims decide to have a different record to some nobody Jew, or billions s of Indians decide to do the same with Pakistanis and so on. This might just become a big fat joke.
So much FUD SlashDot, common you're better than that..
Blockchain technology, if you actually watch the industry, just represents a new data storage method which promises to be a way for banks and financial investment entities to reconcile trades between each other. NOTHING to do with you or bitcoin, everything to do with improving their ability to trust each other and accurately report on who owns what at any given time. applies to cross bank reconciliations, asset trading, cargo shipping and almost any industry that deals with transferring wealth between parties.
There will be no proof of work - that is just an add on option for Blockchains (and anything in principle) which Bitcoin is famous for and which solves a problem bitcoin needs solved: immutability across untrusted nodes.
Banks will run sealed and private Blockchains between each others trusted nodes to eliminate a lot of the accountability and auditing issues which traditional relational databases are vulnerable to. Classical databases allow anyone with root to change anything and require massive amounts of double work and auditing to make sure nobody is cheating. distributer sequential ledgers
(block chains) make muc of that moot.
Very exciting stuff but not in the way most of you currently think. It is not every day a new kind of fundamentally different database paradigm is invented, so thanks Satoshi!!
Every time I see blockchain proposed to replace existing processes I see few remarks on the investments required to set up a "shared, distributed database that spans multiple organizations".
I'm pretty sure the regulators will require these databases to have a high level of security (which is built in, blockchain adepts will say), a high level of resilience (per bank, not as a 'distributed' system). This will drive up cost.
On top of that, a distributed database of investment transactions must be able to handle the load of the many millions of such transactions per day. The data will be replicated, which will require tons of storage. And the systems will need to be fast, tons of servers required.
So, I'm not so sure this will happen in the near future.
Actually working in the banking business instead of gambling in the stock exchange casino would save banks hundreds of billions. No wait, scratch that, it would save taxpayers hundreds of billions.
Assorted stuff I do sometimes: Lemuria.org
I think they mean "to identify exactly where SAVINGS could be achieved"
American idiots.
Loan approval is a completely different application from transaction processing.
sure, just like text entry never happens in excel, apps will never run on "phones", browsers are not an "OS", touch screens are only for mcdonald's employees, the "internet" is just for educational and military institutions, email is for 7-bit text and mime types are not needed, frames will make any future html advancements unnecessary.
you must be new here. as soon as "transaction processing" is sped up, what do you think the bankers will do? just sit on their duffs? or take advantage of that fact, and the effects will ripple into other things?
let us give a computer analogy. you are claiming that upgrading from a 75 mhz pentium I running DOS to a 3.3 ghz quadcore CPU running solaris, that everyone will stick to the same i686 instruction set, and continue coding single-threaded single-process applications, because it's all the same CPU family still, nothing has really changed...
once that additional power is there (even if only in reduced time and cost per transaction), they will take advantage. like the NSA, they'd be stupid and not doing their jobs if they didn't do such things.
time is money and money is power. this gives them more time and more money. that means more power. that means they will use these new powers in other areas, besides the main "application".
so if firefox reduces RAM usage from 512M down to 32M for google.com homepage, you are claiming that people on 1G RAM systems might not change what other applications they run at the same time as firefox?
....the extra in fees they claim they need to charge customers to implement new technologies. Yet, we still have paper checks and magstripe bank cards. How about fixing that excessively fraudophil tech?
The motto, the dream, the hope, the aspiration of every bank is to become so big no one else can compete, and to divert all the profits as executive salaries, boni and other incentives.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
I recall there are limits of the number of transactions per second in Bitcoin. Do these need to be overcome? Also what is the storage profile?