The mass uptake of this technology could be drawing closer as six global correspondent banks are set to engage in a Swift blockchain trial.
The goal of this project is to ascertain whether distributed ledger technology is up to the challenge of helping banks to manage funds held in overseas accounts. Bank messaging network Swift has collected the participants as part of a global payments innovation (gpi) plan.
Among the six banks to first embark on the trial are major players including BNP Paribas, BNY Mellon, RBC and Wells Fargo. This group is set to be joined by a cohort of as many as 20 other banks for further testing of the initiative.
This application of the technology could greatly simplify the monitoring of overseas funds by streamlining the process, that currently relies of end-of-day statements and credit and debit updates. Keeping on top of this current format is proving inefficient and extremely costly.
New technology will be involved in this trial, with Hyperledger Fabric V1 set to be implemented within the private permissioned blockchain. ISO 20022 message formats will be supported by this platform.
The potential opportunities Blockchain offers for the reinvention of arduous, complex processes have previously been speculated, including the massive, archaic processes involved in shipping and logistics.
A great deal of planning and partnerships have been undertaken and formed with Blockchain implementation in the financial services in mind. A group of seven banks including HSBC combined forces to drive toward the use of the technology by the end of this year.
Recently the likes of J.P Morgan, Microsoft and Accenture joined the Ethereum Alliance to work on finding ways to make blockchain viable within industries and major organisations.
An example of this foresight on Blockchain technology can be seen in the partnership of IBM and Maersk, two giants working together to reduce massive documentation traditionally involved, and to improve transparency.
Not only does Blockchain potentially offer a streamlined, digital replacement, but it could also be significantly more secure, and important area given the current level of fear surrounding cyber security.