Everyone on Wall Street seems to agree that blockchain is going to be a game-changer.
The technology is thought to have the potential to improve productivity across Wall Street in areas such as as banking, payments, and the capital markets. But the degree to which blockchain will revolutionise financial services is really anyone’s guess.
Blockchain became a ubiquitous Street buzzword thanks to the rise in popularity of the cryptocurrency bitcoin, which is powered by the technology.
Cognisant, a US-based digital consulting firm, recently surveyed over 1,500 executives from over 570 financial services firms on their respective strategies for integrating the technology into their infrastructure. The overwhelming majority (91% to be exact) of firms surveyed said they recognise the importance of blockchain to the future of the industry. However, only a few are actively integrating blockchain into their infrastructure. Most are dilly-dallying in the experimental phase, according to the Cognisant.
“While some early adopters are pushing ahead rapidly, most firms remain content with learning about the technology and testing proofs of concept internally until the future direction comes into focus,” the report said.
Those firms, according to Cognisant, don’t have a “viable” path forward.
To be sure, it makes sense that firms would want to take time to figure out how blockchain could work for their company. The technology is barely a decade-old, extremely complex, and development costs money.
Nevertheless, Cognisant is advising firms to get a move on. In the report they outline a number of points for financial firms to consider when developing their blockchain strategies.
Here are a few:
- Don’t waste time worrying about costs. “Learning will be iterative, and costs and benefits may only become defined more clearly as the project pro-gresses. In addition, many reasons to move forward are strategic in nature and cannot be quantified at the outset.”
- Don’t just give all the work to IT. “Rather than emanating from IT, blockchain projects should be designed to address specific business problems or opportunities, and business stakeholders should be involved from the outset.”
- Keep calm and carry on. “Recognise that blockchain is still in the early stages of development; innovation will continue, and the infrastructure will evolve.
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