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blockchain-based networks such as Ethereum


Aug 23, 2022

Goldman Sachs is already trading various debt securities such as bonds through blockchain-based networks such as Ethereum and is building its own blockchain-based trading platform. JP Morgan Chase already uses a platform called Onyx.

These banks have a variety of high-tech transactions, but the system is old and relies mainly on not working properly. Goldman Sachs and others are building a system based on a blockchain that can make profits faster and less expensive.

Blockchain technology, also called distributed book technology, is the foundation on which the cryptocurrency market operates. Simply put, it is a software that records asset movement status and ownership information using an open record storage system (central ledger). All participants are operated to have the same central ledger.

Wall Street’s blockchain-based system is partially different from cryptocurrency operating systems such as Bitcoin. It is a method in which central institutions such as banks or the Korea Federation of Banks have the authority to allow entry into the network.

In addition to banks, Wal-Mart manages its supply chain with blockchain technology. Famous companies in the real estate industry also record home ownership.

Goldman Sachs and others say that trading on a blockchain-based platform can lower the risk of trading partners. Supporters also say it is easy to grasp the status of various assets, such as stock issuers and others.

Tom Farley, chairman of the New York Stock Exchange (NYSE), said, “Blockchain technology will be applied to all financial services.”

Wall Street companies have been testing blockchain technology for at least five years. However, it is not yet widely applied to financial transactions.

There are cases where blockchain technology has been abandoned. European insurance companies attempted to introduce blockchain technology by forming a consortium called B3i in 2016, but the consortium was disbanded in July because they failed to raise additional funds.

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