You may not yet have come across the Blockchain but it is making waves within the financial services community and is heralded as one of the most significant advances in technology for a generation. In essence, it is a new database technology that is based on a distributed ledger, which itself is cryptographically secured. So what does that mean in practice? Well it essentially means that data can be stored and updated in an irrefutable way and accessed by many participants transparently. This makes the technology ideal for a wide range of applications especially where there has been a need for a central record keeping organisation.
In financial services the technology has been used as the backbone of the crypto-currency Bitcoin and is now being applied to a wide variety of payments applications. Investment banks are also interested in the Blockchain as a means of greatly simplifying their complex back office reconciliation processes. At CGI our teams are already working with clients across the sector on proof of concept work to put this new technology through its paces, having established strong relationships with many of the innovative start-ups that have pioneered Blockchain concepts.
Although initial interest has centered on financial services other sectors are now imagining how this new innovation might change their business processes for the better. Just like the TCP IP Protocol, upon which the internet is based, has transformed how we can share information, so too the Blockchain offers a new flexible platform with a plethora of uses, not least in Government.
Jerry Norton our Vice President of Financial Services recently blogged for City AM about the potential for the Blockchain to transform how the Land Registry approaches its record keeping function. But this is just the tip of the iceberg, Government is at its heart a key record keeper for its citizens and the technology could revolutionise areas including tax, benefits and VAT accounts. In all such cases there is a need for fraud-resistant updates to records that show ownership and obligations – which is exactly where the Blockchain makes a difference. People have even speculated about the Blockchain as a means for the electorate to cast their votes.
Sharing information is critical to so many of the business processes that underpin the UK’s public services and government departments. As the public sector strives to reimagine new, more efficient ways of providing services and to foster greater collaboration amongst civil servants and disparate departments the Blockchain could become a key underlying technology. The ability to seamlessly share highly trustworthy information, underpinned by the principles of consensus and cryptography, offers a powerful new approach.