Whether or not Bitcoin will be the be-all and end-all of money as we know it, remains to be seen. That decision will not be made for many years to come, even though it opens up a lot of interesting and promising possibilities. But one thing no one can deny is the sheer potential of Bitcoin’s blockchain, a powerful technological tool with nearly endless possibilities.
Bitcoin’s Blockchain – The Future of Financial Record Keeping?
In a surprising turn of events, Nasdaq will be conducting a small experiment so see if Bitcoin’s blockchain technology can be adapted for financial record keeping on a grand scale. Given the recent announcement from Nasdaq acknowledging their interest in testing blockchain technology, it will be interesting to see what this experiment could lead to.
Bitcoin’s blockchain is an all-powerful tool that not only logs new network transactions, but also keeps track of every single Bitcoin transaction ever since its inception in 2009. And the most impressive feat is that the blockchain makes all of these individual transactions visible to the public, creating a fully transparent financial ecosystem.
However, that will not be the type of record keeping Nasdaq wants to purchase during this experiment. Instead, the exchange is interested in exploring the option to allow additional information be recorded on the Bitcoin blockchain. Additionally, there will be also be a few tests regarding adding information about certain Bitcoin transactions.
Even though blockchain technology could ultimately lend itself to record trades of stocks in public firms listed on Nasdaq, the plan is to focus on the private market for now. Record keeping through Bitcoin’s blockchain is not only more cost efficient compared to traditional means, but it will also complement Nasdaq’s own cloud-based data management system.
“There’s really no great system in place to ensure that record keeping of a company’s ownership structure is done accurately along the way and is auditable to the beginning of time. Myself and other colleagues here at Nasdaq think the blockchain can be essential to such a system.” – Nasdaq CIO Brad Peterson told the media.
A Handful of Companies Agree To Participate
As mentioned before, this experiment will only target Nasdaq’s private market for now. A handful of companies have agreed to participate in this blockchain experiment, but no names have been disclosed. Matching a company’s shares to an investor will be done by creating a “corresponding entry” on Bitcoin’s blockchain, containing vital information about the transaction itself.
One of the companies agreeing to participate in this experiment is also the company who will be assisting Nasdaq during the testing period. Chain is a company specialized in blockchain technology, and they will help Nasdaq determine how to represent company shares on the blockchain. Additionally, Chain is in the process of developing blockchain reader apps, which allow companies and shareholders to see information they are privileged to.
Source: Technology Review
Images courtesy of Nasdaq, Chain, Shutterstock