The heads of fintech businesses have emphasised that the development of blockchain is “moving very quickly” and is likely to gain further traction in the financial industry this year.
Speaking at the AltFi Australasian Summit yesterday, John Pellew, founder and CEO of fintech company Othera, remarked that he believes 2017 is going to be a “watershed year” for blockchain technologies.
In response to a question regarding how soon the financial services industry could see blockchain gaining real traction, Mr Pellew explained that his company is already working on an agreement with clients to deploy enterprise solutions during the year.
“It’s moving really quickly,” he said. “I think that it’s going to be a massive rush very, very soon.”
Greg Dickason, the executive manager technology for CoreLogic, previously explained that blockchain is the technology that the currency bitcoin uses, which enables people to transact without any need to know or trust each other.
He said: “It also allows for money to be ‘programmed’ through ‘smart contracts’, and for accounts to be reconciled almost instantly.”
Speaking to The Adviser earlier this month, he also elaborated that blockchains are a type of decentralised database that keeps records of digital transactions, and are presenting a threat to the mortgage and property industry as they “replace the function of the middle man”.
Mr Dickason explained that these “distributed public ledgers” are trusted places to record transactions and could revolutionise the way consumers transact.
Addressing the audience at the AltFi Summit, Othera’s Mr Pellew highlighted that blockchain technology aims to bring transparency and trust back into the system of making payments.
“It's one of those things that will definitely drive change and drive accountability, and I think that the financial services industry would be in a better place if they chose to go down that road before the regulators force them to, because they will be in more control of how they deploy it, and under what sort of frameworks, and it's just a matter of when,” he said.
Speaking on the panel alongside Mr Pellew, Loretta Joseph, director of business development at the Sydney Stock Exchange, added: “I think when you automate processes (and we're talking about the blockchain), when you disrupt people's role, relevance and revenue, there is pain, and change is pain. But, I think the first stage of the blockchain is really bringing automation into the financial transaction process, so looking at dealing between A and B without the intermediary.
“When you take out the intermediary, you do upset industries, [like] what we're seeing at the moment in the financial services. But, I think over time, banks will work out there's other ways to make money.”