Bitcoin and Bitcoin technology are like two sides of the same coin. While Bitcoin is clearly not a favorite among banks and financial institutions, its underlying Blockchain technology receives a much favorable treatment. According to the regulators in Hong Kong and other places, the Bitcoin’s underlying technology can genuinely help curb money laundering issues.
Blockchain is a distributed ledger that maintains a record of all the transactions happening over the Bitcoin network. The same, when use in a conventional setting, can keep records of all the transactions associated with each bank account along with the identity of the account holder in an immutable database. Any information once entered into the blockchain can’t be deleted or modified, this will ensure that no one modifies the records. On the other hand, it will also ensure that the banks and financial institutions comply with all the prescribed anti-money laundering and know-your-customer regulations by storing customer data on the blockchain, which can be verified by regulators in real time.
The Hong Kong Securities and Futures Commission is convinced that the digital currency technology can be applied to banks and financial institutions in places where solutions to the problems are clear. Benedicte Nolens , the head of risk and strategy for the Hong Kong Securities and Futures Commission has recently voiced her opinion about the distributed ledger technology at the MIT Technology Review Emtech Conference saying- “I do think quite obviously KYC and AML stands out there as a pretty significant inefficiency and problem case. If you start tallying up the fines, that banks have been subjected to globally for this field, you’re into the 10 billion or more of US dollars,” Her views come at the time when the Mainland China, as well as Hong Kong, are opening up to the implementation and use of […]
