Big Four auditing firm Deloitte claims that Fintech industry professionals no longer think that blockchain or distributed ledger technology (DLT) is “groundbreaking and merely promising.”
The professional services firm’s 2020 Global Blockchain Survey polled around 1,500 senior management professionals and found that:
“Initial doubts about blockchain’s usefulness are fading as business leaders now see it as integral to organizational innovation.”
The report reveals that Fintech firms and businesses in many other industries are increasingly investing their resources into developing blockchain-powered solutions.
It’s worth noting that blockchain is simply a data structure and the excessive hype created around it was never appropriate. While blockchain or DLT won’t solve every problem, it does have legitimate use cases.
For instance, the Islamic Research and Training Institute (IRTI), a member of the Islamic Development Bank Group (IsDB), has teamed up with Samsung-backed blockchain tech company, Blocko, in order to implement a DLT-powered “smart” credit management platform.
Fintech, specifically blockchain or DLT, may enhance the existing credit management system, according to the IRTI team. It will offer a new type of incentive mechanism that will aim to encourage early repayment and will contribute fees to an insurance pool that will be used to cover any loan defaults.
The IRTI team claims that this type of system won’t work effectively if implemented using traditional technologies. They believe that a blockchain-enabled platform would provide an effective solution.
It’s also better to leave technical design considerations to application developers who have a strong background in math and computer science. It doesn’t make much sense when professionals from a non-technical background begin recommending how to apply (or not apply) blockchain to business processses.
In September 2018, the World Economic Forum (WEF) published a report in which it revealed that there are well over 65 different use cases for blockchain or DLT.
The WEF had noted:
“Blockchain applications could disrupt how the world manages environmental resources, helping to drive sustainable growth and value creation.”
While it now appears that many companies have realized the potential benefits of DLT, the WEF had claimed, back in 2018, that this opportunity (blockchain) “remains largely untapped by developers, investors and governments as the majority of projects are currently focused on areas like Fintech and supply chains.”
The WEF suggested that new global platforms were needed to “incubate a responsible blockchain ecosystem rather than specific projects.”
John Wu, President of AVA Labs recently told Crowdfund Insider:
“The Deloitte Report is yet another affirmation in the growing body of research that underlines industry adoption of blockchain technology and digital assets…. As enterprises and institutions begin to consider how we will rebuild the global financial system following this pandemic, incremental progress is a luxury that we no longer have. Institutions and individuals need to be best equipped to manage financial risks, protect investments, and even grow our assets when the next crisis hits.”
Jackson Mueller, Director of Policy and Government Relations at Securrency, remarked:
“There are at least 23 regulatory authorities involved in [blockchain and DLT related] discussions, according to a Cambridge Center for Alternative Finance study…[We need to develop] …appropriate standards that facilitate, not inhibit, cross-border transactions.”
Seamus Donoghue, VP Sales and Business Development at METACO commented:
“As a company that delivers infrastructure to the financial sector to enable migration of finance and capital markets onto the blockchain, we see a broadening interest from Tier 1 and Tier 2 banks to integrate crypto and digital asset custody capabilities into their core banking infrastructure.”
Donoghue added the launch of the Facebook-led Libra project and the rise of the stablecoins market is “a growing validation of the business case that the US banks won’t ignore for long.”