IT Solutions: Financial sector expands use of blockchain databases

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Survey shows 65% expect to use blockchain in three years

Banks and financial markets are adopting blockchain distributed database software for their payments and lending services at a pace faster than once expected, according to a survey of 400 such businesses globally.

Blockchain software is the basis of bitcoin, first developed in 2009, and acts as an automatic public ledger for transactions, primarily financial transactions.

The survey, conducted by a research division of IBM, found that 15% of the banks and 14% of financial market institutions intend to implement full-scale, commercial blockchain-based services in 2017.

Mass adoption of blockchain isn’t far behind. The survey found about 65% of the banks expect to have blockchain in production within three years.

Blockchain is expected to be used in financial services for retail payments and consumer lending services, while also providing reference data.

While IBM already offers its own flavor of blockchain for customers, Mastercard said this week it is experimenting with the technology. Mastercard could offer blockchain functionality in its open Application Programming Interface tools to be used by third-party developers in building their own programs and apps, a Mastercard executive said.