Andrey Sharov, a vice president at Sberbanks, a Russian bank, recently told journalists that blockchain technology would render banks redundant within a decade. However, in a recent interview with CNBC, Brock Pierce, the chairman of Bitcoin Foundation, a cryptocurrency advocacy organization based in America, said, although blockchain technology will have a negative impact on some aspects of banking, especially areas that do not offer much value, it will ultimately create new opportunities for banks. Below is some more information on how blockchain technology will affect the future of banking.
An Overview of Blockchain Technology
Brock Pierce comments on the future of blockchain resonate with some players in the banking industry. Specifically, banks generally feel that the technology may have myriad applications in the banking space, from remittances to securities exchanges to improving efficiency. In fact, some of the world’s biggest banks, including Goldman Sachs Group Inc, Citigroup, and JPMorgan Chase & Co are developing banking products based on blockchain technology.
Blockchain is basically a distributed ledger that accepts input from a group of people. This means that it is a continuously growing list of transactions or data records. The four components of a typical blockchain include an ID (“hash”), hash number from the …