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Deloitte lists 5 steps for implementation of blockchain systems

Leading ‘Big Four’ consultancy firm Deloitte has released a new report that underscores key uses for blockchain or distributed ledger technology to transform the finance industry, while highlighting the potential challenges to its widespread adoption.

Titled “Over the horizon: Blockchain and the future of financial infrastructure”, the report draws on the research from Deloitte and the World Economic Forum, focusing on the ways in which blockchain technology has captivated the imaginations and wallets of the financial sector.

The report details several use cases including payments, insurance, deposits and lending, capital raising, investment management and market provisioning, as well as necessary conditions where blockchain can flourish.

“An interesting thing about these use cases is that although the applications are very different, some basic characteristics are the same. They include a shared repository and multiple writers to the repository. They also involve the removal of one or more intermediaries from the value chain, with trust enforced programmatically rather than through centralized institutions”, the report said. “Opportunities with these characteristics are the ones that benefit most from DLT-based systems.”

Five steps for blockchain implementation:

The report provides five critical steps for the implementation of blockchain systems. These include:

  1. Learning about the technology, its disruptive potential and its effects on one’s business
     
  2. Working with business leadership to identity areas where DLT can present material gains or increase risks of disintermediation
     
  3. Categorizing and prioritizing these opportunities, and experimenting with different technology solutions
     
  4. Developing business cases for successful experiments, creating a plan to commercialize the solutions and identifying barriers to scaling them
     
  5. Joining (or creating) networks for use cases that require collaboration

“Organizations that follow these methods can be at the forefront of new opportunities for the industry. However, it’s important to note that though technological innovation has been fundamental to industry transformation, there are other steps that will play a role in this disruption as well,” said Bob Contri, Global Financial Services Industry leader, Deloitte Global. “Before full adoption is possible, there are factors that need to be addressed, including an uncertain regulatory environment, lack of standardization efforts, and the need for a formal legal framework”.

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