Barclays testing blockchain technology

Barclays testing blockchain technology

Barclays are working with Swedish online bitcoin exchange, Safello to test how blockchain technology could be implemented in commercial banking.

Founder of Safello, Frank Schuil, describes his start-up as the “safe fellow of the bitcoin world” and mentioned how their aim is to get the “2.7 billion un and underbanked” into the cryptocurrency market at StrategyEye’s The Future of Payments event in April.

According to Business Insider, the way blockchain software keeps a decentralised record of payments, limits coins from being spent more than once and is a springboard for online transactions without being monitored by a central regulating authority could be a form of technology that is useful to banks.

The speed and cost of blockchain are two qualities that banks are interested in because international transfer of money is slow and expensive at the moment, due to more traditional systems being used.

Despite the interest, many do not believe that blockchain will be implemented soon as it can take many years to adopt new technology because of regulatory issues. Stephen Pair, CEO of Bitpay told Business Insider that he believes that it will take over five years before a bank even adopts a “watered down version of the blockchain.”

Business Insider also reported last week that Santander are interested in this form of payments technology and have found that it will be beneficial for the bank. “We have internally identified 20 to 25 use cases where this technology can be applied,” said Mariano Belinky, head of Santander InnoVentures at MoneyConf in Belfast this week.

Alongside this, Goldman Sachs has also invested in a start-up circle, NASDAQ is experimenting with blockchain and UBS have set up a blockchain lab in Canary Wharf.

The incentive behind all this curiosity comes after the publication of a report earlier this month which revealed that blockchain technology could reduce infrastructure costs by up to $20 billion a year, according to Business Insider.

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