Blockchain beyond Bitcoin

Blockchain technology relies on a digital distributed ledger that operates in a shared and transparent environment without the need for a trusted authority to validate transactions. The distributed ledger contains the entire history of records, and multiple copies of this ledger are accessible to all participants across the network, making the Blockchain completely public and perpetual.

Blockchain is the technology behind Bitcoin, but its applications go far beyond cryptocurrencies. The whitepaper discusses how the Blockchain leverages so-called “Smart Contracts,” in which a contract’s terms are implemented in a computer language and can execute themselves when specific conditions are met. A large number of applications can be created using Smart Contracts, having the potential to span a wide range of industries outside Fintech.

A new financial ecosystem in Luxembourg?

Because it is by essence free from intermediaries and trusts, Blockchain technology should not be applied in isolation. Rather than launching independent projects, industry stakeholders must together envision a new financial ecosystem in order to take full advantage of the benefits of the technology and not be left aside. It is particularly true for the asset servicing industry in Luxembourg where many incumbents act as intermediaries or central counterparties.

Thibault Chollet, Director Technology & Enterprise Application at Deloitte Luxembourg states: “Blockchain technology still has some major challenges to resolve such as acceptance, scalability, performance, resilience, data confidentiality and regulatory surveillance. Nevertheless, it should be a priority for the  financial sector to define a new operating framework for the industry in line with the new paradigm this technology has the potential to bring.”

Read more about the whitepaper on Deloitte’s website: www2.deloitte.com/lu/en/pages/technology/articles/impacts-blockchain-fund-distribution.html