Deloitte: Blockchain Systems Could Rival ACH Network By 2025
By Pete Rizzo for Coindesk,
A new report by the Deloitte Center for Financial Services predicts that permissioned blockchain payment systems will see “significant transaction volume” by 2020.
Such systems, the report said, could reach the scale of the ACH network, which processes 23 billion transactions annually, by 2025. Elsewhere, it projects that bitcoin and digital currencies will go mainstream, but that many alternative cryptocurrencies would likely vanish or be replaced by “state-sponsored” digital currencies.
Deloitte wrote:
“We believe that corporate payments may have a head start in adopting blockchain technology, given the limited set of entities involved and the strong payment-transaction relationships corporates already have with banks.”
Such a transition, Deloitte said, was likely to “erode” product margins at financial institutions, forcing market participants to change how they approach relationships with merchants, consumers, businesses and counterparties. Notably, the professional services firm expects “all aspects” of the securities trade cycle to be dominated by digital technologies.
The report recommended that financial incumbents “ramp up” efforts to explore the technology while “rapidly” developing potential new use cases. Still, it cautioned that the scale and size of the effort needed to bring about this change would pose its own challenges.
The report concluded:
“In our view, while the promise is real, the path to actualizing the potential will not be easy. There is simply too much legacy overhang in making this transition. It will take enormous effort on a collective basis to migrate to a blockchain-based trading and settlement infrastructure.”
The article first appeared in the Coindesk.com
