Frequently asked questions
What is blockchain technology?
Blockchain is a distributed ledger containing several nodes that maintain a shared ledger using a cryptographic oriented protocol. Its perceived advantage lies in its security and fault tolerance as no transaction roll-back is allowed and assets are controlled either publicly or by appointed trusted partners. Not only does this promise multiple financial innovations to emerge, it provides a system of financial information that is almost impossible to manipulate. It’s also worth mentioning that it’s not Bitcoin. Many believe that it forms part of a package deal with cryptocurrency, but cryptocurrency is merely one application of blockchain technology. Though blockchain originated with and underpins Bitcoin, it is also applicable to other financial or non-financial systems such as contracts, energy, cyber security and others.
Is blockchain the financial tool of the future?
Possibly. However, more banks and countries need to collaborate on blockchain exploration to harness its potential across emerging markets. While technologies like this always take some time to fulfil their promise, working together will only expedite the process. For example, in the US, more than 40 banks now have a stake in R3 CEV, a start-up meant to agree on and implement shared standards. Similarly, firms including IBM and Digital Asset Holdings have started the Open Ledger Project to develop open-source blockchain software and Microsoft announced its open Blockchain middleware.
How blockchain technology can benefit Africa’s emerging market?
Imagine being able to move assets across borders and between institutions without paying huge transfer fees. By removing barriers, such as intermediary banks, prohibitive costs, interminable waiting periods, and regulatory restrictions, service providers connecting with the blockchain technology can open up financial systems to entire countries. Given that Accenture figures indicate that raising the financial service spending levels of the developing world to those of lower-middle income countries could generate $110 billion worldwide, a large number of financial regulators in developing countries are interested.
Which Sectors can Benefit from Blockchain?
# Governments # Banks # Financial services # Insurance # Supply chain and logistics # Healthcare # Transportation # Real estate # Industry associations # Retail and FMCG # Manufacturing