Summary of The Hutchins Center Explains: How Blockchain Could Change the Financial System, Part 2

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The Hutchins Center Explains: How Blockchain Could Change the Financial System, Part 2 summary

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In part 2 of their report on blockchains and distributed ledgers in financial services (click here for part 1), David Wessel and Peter Olson of the Brookings Institution moderate conflicting viewpoints on how users, global financial organizations and government regulators will interact in and forge the long-term future of the disruptive technology. They explore nuanced questions such as whether cryptocurrencies are necessary for the underlying decentralized exchange system, as well as what role state entities and entrenched businesses will play in balancing payment evolution with regulation. getAbstract recommends this highly instructive article to executives interested in discerning the trajectory of blockchain and distributed ledger technologies.

About the Authors

Peter Olson is a research analyst at the Hutchins Center on Fiscal and Monetary Policy, where David Wessel is the director.

Summary

Blockchain, the digital information transfer and accounting platform, holds huge potential to transform the existing global payments system. Users could harness the distributed ledger technology, which powers bitcoin and other cryptocurrencies, to disrupt the centralized payment-processing model. Advocates of adopting bitcoin and other digital legal tenders as new payment media stress that cryptocurrencies are essential to making this revolution possible. Proponents believe that bitcoin is a necessary financial incentive for independent users to engage their computing power in ...


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