Commonwealth Bank the first Australian bank to join global fintech partnership

blockchain

Yep, you read that correctly. Instead of lagging behind and furiously shoving its head in the sand, an Australian financial institution has been announced as one of the first 9 banks to sign a world first global blockchain partnership.

Joining some of the largest banks on earth, including Barclays, JPMorgan and Goldman Sachs, Commbank executives have spent the past year in and out of New York hotel rooms, helping define an innovative framework for using blockchain technology in the markets.

Imagine that you’re walking down a crowded city street, and a piano falls from the sky. As dozens of people turn to watch, the piano crashes down right in the middle of the street.

Then, without a second to lose, every person who witnessed the event is strapped to a lie detector and recounts exactly what they saw. They all tell precisely the same story, down to the letter.

Is there any doubt that the piano fell from the sky?

This is the principle behind the blockchain, a powerful and widely misunderstood invention that could profoundly affect our relationship with the digital world.
— Mike Gault, Founder & CEO, Guardtime

Diehard fintech junkies can read the whole lot here, but here is a simple breakdown of what this all means for the rest of us.


The problem

Just like the entertainment industry toppled before them, a large portion of the tasks and resources inside financial organisations are deeply inefficient and superfluous to their actual value proposition.

The solution

With that in mind, some very smart ex-Wall Street types built a 'startup' called R3, focused on taking the best financial technology from the world of startups and selling it to the world's largest financial organisations.

The shortest and least annoying video explanation of blockchain technology I can find

The outcome(s)

1. As the video explains, removing the need for data to be 'verified' by a third party means we no longer need to wait for a bored middle manager to approve our home loan payment (or international money transfer, or the mountains of currently paperwork generated by the trading of stocks).

So you get your money and information much faster - Hurrah! 

2. Mister manager loses his job and inevitably struggles to find anywhere willing to pay him very well for analysing spreadsheets and lifting a rubber stamp every few hours.

3. Banks save billions. Instead of passing on the value to their long suffering customers, 4 smarmy executives become instant trillionaires and proceed to buy up a number of small nations.

4. The towering skyscrapers filling our cities will be emptied, leaving several convenient recharging stations for our new robot overlords.


Joking?
Sure.

Beyond the realms of possibility?
If only.