Sign up USA
Proactive Investors - Run By Investors For Investors

IBM set to bring blockchain into banking mainstream with SME-targeted venture

It would take the disruptive financial technology behind cryptocurrencies, like Bitcoin, into one of the first implementations within the institutional banking system.
IBM logo on building in America
IBM’s Digital Trade Chain is intended to assist international trading for SMEs

As reports emerge of further instability in Bitcoin rival Ethereum, US tech giant International Business Machines Corp (NYSE:IBM) has revealed plans to take blockchain into the corporate mainstream.

IBM is working on new blockchain technology to be used by seven of the world’s biggest banks, including HSBC, Deutsche Bank, Societe Generale and Rabobank.

Evidently, the moves would take the disruptive home-brewed financial tech behind cryptocurrencies like Bitcoin into one of the first implementations within the institutional banking system.

IBM’s Digital Trade Chain is intended to assist international trading for small and medium sized enterprises (SME).

Blockchain is the key component of alt-currencies like Bitcoin and Ethereum, but its potential applications are much broader than these initial breakthrough examples.

In essence, block chain is a synchronized, real-time ledger existing across a network of computers and it comes with an inherent validation system. Due to its construction and structure, it is seen as a highly secure and supposedly tamper-proof system for keeping track of transactions.

IBM’s Digital Trade Chain intends to track and manage international transactions for SMEs, on behalf of banking service providers.

In a CNBC report, Radobank chairman Wiebe Draijer explained that the banks would still take care of the ‘old payment technology’ whilst the infrastructure and administration of the international trading would be “done on the blockchain”.

Ethereum underlines human insecurity surrounding cryptocurrency

Whilst the block chain is seen as a secure system, the facilities and set-up around trading the cryptocurrencies like Bitcoin have had a number of high profile frailties – the most recently being the extreme volatility of Ethereum, a rival to Bitcoin.

Last week, the value of Ethereum reportedly crashed on the GDAX exchange, plummeting from around US$320 down to just 10 cents in a matter of moments as a “multimillion dollar sell” executed and triggering a series of auto-ordering across the exchange.

The price snapped back thereafter, back to similar pre-crash levels.

More recently, on Monday, the value of Ethereum was again subject to further volatility, dropping some 20% and there had also been impacts from internet rumours that the cryptocurrency’s founder Vitalik Buterin had died (which he dispelled, by tweeting a verifiable photo of himself on Sunday).

View full IBM profile View Profile

IBM Timeline

Article
October 18 2017
Article
October 16 2017

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You understand that the Company receives either monetary or securities compensation for our services. We stand to benefit from any volume this write-up may generate.

You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

Copyright © Proactiveinvestors.com, 2017. All Rights Reserved - Proactive Investors North America Inc., Proactive Investors LLC

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use