Future prospects for cross-border payments
Major banks and financial institutions are realising that blockchain technology could vastly improve the efficiency of their processes – particularly in cross-border payments – and reduce costs. Many have joined forces to research new applications, though regulatory barriers remain.
In this digital report, OMFIF and CCBU investigate the effects of blockchain and distributed ledger technology on financial institutions’ business models. We engaged with experts representing other diverse perspectives and sectors, including fintech and technology providers from the blockchain and DLT industry. Analysis of financial technology regulation and public policy papers complements our research.
Regulatory and governance challenges remain
Regulatory approaches to blockchain in financial services are incomplete, and significant upgrades are required, both at global and domestic level. Blockchain and DLT are providing the impetus for a broad array of economic activities to shift from centralised to de-centralised market structures. However, while different applications might make use of similar underlying technologies, the precise regulation and legal risks that blockchain and DLT might encounter vary depending on the nature of the use cases.
Future trends for blockchain in banking
Many new features of blockchain have emerged over the years, and the technology will continue to evolve
rapidly. Payments solutions are set to become the dominant use case, though banks still face regulatory and scalability issues.
The OMFIF Digital Monetary Institute is a high-level group which convenes policy-makers, technologists, financiers and regulators to explore the challenges and opportunities of digital finance. Click here to explore research and membership benefits of the DMI.