Current ledger tech not equipped for finance says SWIFT

Existing blockchain and distributed ledger technologies (DLT’s) cannot fulfil the requirements of the financial industry according to a new SWIFT paper.

According to the report, existing DLT’s are not ‘mature’ enough to be implemented into the financial sector and identified eight requirements that need to be addressed before the technology can be rolled out.

Strong governance, data controls, regulatory compliance, standardisation, identity framework, cyber security, reliability and scalability were pointed out as the failings of DLT’s.

It also states that significant research and development is required on these issues before it can be applied at the scale required for financial services.

The report comes shortly after the suggestion from Euroclear’s director of product strategy and innovation that greater understanding of blockchain and DLT’s capabilities will shortly be known as it nears the end of the experimentation stage.

“The financial services industry is moving from an educational phase, into an application phase when it comes to DLTs,” said David Treat, a managing director and global head of Accenture’s, Capital Markets blockchain practice who acted as collaborator on the paper.

“We now have a strong understanding of DLT and its benefits, but we need to identify which areas are best suited, as the technology will not be a silver bullet to solve all business issues.”