Bain & Company recently published a 12-page brief about blockchain technology, “Distributed Ledgers in Payments: Beyond the Bitcoin Hype,” authored by four employees based in London.
“Changes to the complex pipelines that make payments possible rarely occur, but when they do happen, the consequences can be profound,” states the brief. “Distributed ledger technology, first showcased by the Bitcoin digital currency network, has the potential for such dramatic change.”
Founded in 1973, the Boston-based management consulting firm has 5,700 employees spread across 53 offices in 34 countries. As one of the world’s three largest strategy consulting firms by revenue they provide advice to businesses, nonprofits, and governments.
“We’ve worked with the majority of the Global 500, thousands of major regional and local organizations, hundreds of nonprofits , and private equity funds representing 75 percent of global equity capital. We are proud of our clients’ track record, like the fact that our public clients have historically outperformed the stock market 4 to 1.”
– Bain & Company
The report spends time describing “established technologies,” that distributed ledgers combine. The block chain, Digital signatures, A consensus mechanism, and A digital currency.
“The precise features of distributed ledgers vary depending on the situation,” the authors state. “Some systems, such as Bitcoin, allow any participant to validate transactions, while others, such as Ripple, restrict permissions to a small group of trusted parties.”
The brief argues that banks are well positioned to confront the changes triggered by the rise of these disruptive technologies, in theory, while the situation is more complicated in practice.“More than $150 billion in revenue at risk for banks that cannot overcome technical, adoption hurdles of digital currency,” Bain & Company state in the papers announcement. “Regulatory and other hurdles may have forced most start-ups to partner with, rather than compete against, incumbent banks, but distributed ledgers will create […]
