Bitcoin technology could one day be central to global finance
A report from the World Economic Forum predicts that the underlying technology introduced by the virtual currency bitcoin will come to occupy a central place in the global financial system.
A report released Friday by the forum, a convening organization for the global elite, is one of the strongest endorsements yet for a new technology — the blockchain — that has become the talk of the financial industry, despite the shadowy origins of bitcoin.
“Rather than to stay at the margins of the finance industry, blockchain will become the beating heart of it,” the head of financial services industries at the World Economic Forum, Giancarlo Bruno, said in a statement released with the report.
Unlike existing financial ledgers or databases used by banks and other institutions, the blockchain is updated and maintained not by a single company or government.
The report says the technology could help improve both mainstream transactions, like global payments and stock trading, and lesser-known areas like trade finance and contingent convertible bonds.
The 130-page report from the forum is the product of a year of research and five gatherings of executives from several major institutions, including JPMorgan Chase, Visa, MasterCard and BlackRock.
In addition to the technology issues, the report says that the industry will have to work with governments to create rules and laws to govern transactions.