Blockchain will be a gamechanger for financial transactions, although regulatory issues abound, noted panellists in a session at the World Economic Forum’s 10th Annual Meeting of the New Champions, taking place this week in Tianjin, China.

“Blockchain will revolutionise banking and financial services as we know it,” said Pierre Gramegna, Minister of Finance of Luxembourg, “I think it is possible that blockchain will replace the word ‘internet’. By the time our children have children, the only time they will see the word ‘internet’ is in science and history books.”

“Some say that blockchain is the new internet of the financial world,” observed Axel Lehmann, Group Chief Operating Officer and Member of the Group Executive Board, UBS Group.

Panellists agreed that blockchain technology has far wider applications. “We now have non-sovereign money and it has a lot of advantages and it is just going to grow,” explained Jeremy Allaire, Founder and Chief Executive Officer, Circle. “The nature of accounting, insurance, corporate governance, voting, all of these systems can be moved to blockchain technologies in the future. We are just at the start.”

There are, meanwhile, important questions about how it will be regulated. On the banking hub of Luxembourg, Gramegna agreed there are still regulatory and taxation issues to be addressed. Yet governments, he said, should be forward thinking. Luxembourg, for example, was one of the first countries to legalise virtual currencies and it has the same open approach to blockchain.

“You need a regulator that is keen. The regulator is there to apply the rules, fully and in an equal manner; but, at the same time, the regulator can be innovative,” Gramegna said. “For sharing values and assets and doing payments, all this is going to become a commodity, and for free – this will change the world in which we live.”

By Scott Thompson

 

 

 

 

 

by Scott Thompson
Scott is Senior Editor at IBS Intelligence. You can follow him on Twitter and contact him at: Scott.Thompson@ibsintelligence.com
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