While we don't know if cryptocurrencies like Bitcoin are ever going to gain mainstream traction, it can not be denied that there's major interest in the blockchain technology that powers the Bitcoin ecosystem.
A lot of financial technology startups are working on this and a new report from the World Economic Forum writes it's certain that blockchain technology will come to occupy a central place in the global financial system because it paves the way for a new financial services infrastructure that is more secure, transparent and effective than the current system.
According to the report, 80 percent of banks around the world could start distributed ledger projects by next year. Funnily enough, the 130-page report does not make a single mention of Bitcoin. While the financial community sees great benefit in the adoption of the blockchain technology, they do not want to be associated with Bitcoin because the cryptocurrency's is often used for illegal activities.
Initially, bank executives shied away from endorsing Bitcoin because it had been used for drugs and crime. Now, however, many have focused on ways to create blockchains without using Bitcoins for transactions in any way.
This is attractive because blockchains — or “distributed ledgers,” as they are often described — could offer a new way to move money and track transactions across borders and other networks in a more secure, transparent and effective way than the current system.
Distributed ledgers are often viewed as most attractive to industries with businesses that lack a central institution they can trust to keep their records.
The adoption of the blockchain will largely be a behind-the-scenes thing, consumers will not see any changes but hopefully it could lead to cheaper and faster financial services. Full details at NY Times.