The skeptics are flocking out of the shadows to warn investors and innovators that blockchain may not be the catch-all solution and market-changing disruptor it promises to be. Yet, supporters of the technology seem to be stronger than ever.
The latest vocal proponent of blockchain for the enterprise is Sergio Ermotti, CEO of UBS Group.
“It’s almost a must,” Ermotti told CNBC this week (June 18) about the role of blockchain in the enterprise. “The freeing up of resources to become more efficient will come through technology, and blockchain is a great way to allow us to … reduce costs.”
The financial services industry will have to at least explore blockchain to stay relevant and respond to increasing pressure on margins, he added.
“The only way you can stay relevant is not only by being strong in terms of capital, in terms of products, the quality of people you have, advice you give to clients,” continued Ermotti. “You need also to be able to price it correctly.”
Blockchain may take some time — as long as a decade — to transform financial services costs, Ermotti said. However, he is confident blockchain “will be as crucial and disruptive, and changing as regulation was in the last 10 years.”
Walmart has certainly aligned itself with the view that the enterprise cannot miss out on blockchain. Earlier this week, the retail giant secured three blockchain-related patents, according to Cryptovest reports. One of those patents addresses household electric bill management, while another relates to storing patient data on a distributed ledger technology (DLT). The third relates to a “system that can help users securely control or limit the access to a real or virtual space.”
The patents certainly seem high-tech and futuristic, but they address key issues that blockchain innovators are hoping to target, including cost reduction and data privacy. According to reports, Walmart has already drafted two additional blockchain-related patents pertaining to supplier payments and digital shopping.
Businesses like Walmart prove that the enterprise is looking outside of the financial services box to use blockchain. In Walmart’s case, everything from B2B payments to securing health data is an option for blockchain tech.
But a new report from CCN suggests that one industry could soon overtake even the FinServ market in terms of blockchain innovation. The logistics sector, the publication said in a report this week, is quickly gaining ground on financial services in terms of blockchain projects in the works.
“Supply chain … involves a multitude of moving parts, suppliers manufacturers, distributors,” the publication wrote, noting that one of the biggest selling points of blockchain is its ability to instill trust. CCN continued, “There are two points of trust to be had that are beneficial. Internal trust, in which different moving parts are accountable and therefore reliable. Consumer trust, in an age when people care more and more about fair trade, ethical sourcing, and the like, it’s beneficial for smaller organizations to be able to prove those claims.”
CCN added that even banks’ blockchain initiatives often target supply chains. For example, HSBC and ING‘s initiative to facilitate real-time trade finance transactions using DTL. This week, however, financial services continue to stay in the blockchain spotlight.
In addition to the news from UBS and Walmart about their FinServ-focused blockchain efforts, blockchain outfit Ripple teamed up with the Federal Reserve, joining its Faster Payments Task Force Steering Committee, AMB Crypto reports said. Ripple’s Head of Research on its Business Development team, Ryan Zagone, was elected to join the committee that targets payment system overhauls in the country.
“It is a privilege to be selected,” Zagone said. “I look forward to leveraging Ripple’s global experience as the task force assesses ways to increase speed, efficiency, access to and competition in payments.”
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