The potential of blockchain technology in financial services, a study from CDP, SIA and IBM

The use of blockchain technology could represent an opportunity in the financial sector, introducing a real paradigm shift compared to existing technologies, with great potential for building completely new business models.

In the past few years, the acceleration of the dynamics of the adoption and development of blockchain technologies - more specifically Distributed Ledger Technologies or DLT, which identifies the set of solutions that enable the secure validation and recording of updates to a shared distributed ledger, between the notes of a computer network - has contributed to an emerging phenomenon, brining it to the attention of companies and public institutions, which have sensed its great potential. The white paper produced by CDP, in collaboration with SIA S.P.A. and IBM Italy, aims to make a contribution to the ongoing debate. It shows that there has been a significant acceleration in the dynamics of the adoption and development of DLT in the last two years:

  • venture capital investment in companies active in blockchain technology went from 1.6  billion dollars in the two year period from 2015-2016 to 27.3 billion dollars in the 2017-2018 period;
  • patent applications related to blockchain increased from 648 to 1441 in the same period.

The report confirms the innovative potential of the new technologies, but also highlights the need for extensive action by national and international regulators, to guarantee orderly development and protect stakeholders, to make full use of the opportunity.
Following the signing of a collaboration agreement between CDP and IBM in June 2019, the study analyses the potential impacts of the introduction of blockchain for three specific cases in the financial sector: the know your customer process, making the acquisition of customer data more efficient, in compliance with anti-money laundering regulations, the crossborder payments system, which could open up great opportunities for international transactions, especially for SMEs, and the bond issuing process, with a view to simplifying it and enabling those excluded today to access new forms of financing.

For more details read the white paper (Italian version)