UBS CEO Ermotti calls Blockchain a must-have for companies and banks!

in #blockchain5 years ago (edited)

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Sergio Ermotti, Managing Director of Swiss banking giant UBS, attaches great importance of the blockchain technology. Speaking to US news channel CNBC, he foresees a bright future for distributed ledger technologies, especially in the financial sector.

Especially for banks, the technologies represented a pioneering opportunity. For example, these have now become almost a must-have for companies. Meanwhile, more and more money houses are turning their eyes to the potential of Blockchain worldwide.

UBS CEO Sergio Ermotti is no real crypto fan - as the Swiss has repeatedly proven in the past. However, this does not distract him from the blockchain technology behind the cryptocurrencies.

Moreover: in a conversation with the US economic intelligence service CNBC, he pointed out the special potential of the blockchain for the banking sector.

"The Blockchain is almost a must-have. Technologies will be [in the future] free up resources and make us [banks] more efficient. Blockchain is a great opportunity that allows us to reduce costs."

Such cost savings are necessary, as in the long term, the business pressure on banks is growing, according to Ermotti.

These face shrinking profit margins in times of thriving digitalization of the entire financial industry. Particularly in the area of ​​day-to-day business, more and more private companies are outperforming traditional financial institutions.

"Our industry will continue to be under pressure in terms of gross margins. There is no doubt about that. The only way to stay relevant is not just capital, products, employee quality and customer service. You also have to be able to derive the right prices from this", said the UBS Managing Director about the benefits of the upcoming blockchain application. In addition to adaptation in the transaction business, Distributed Ledger Technologies (DLTs) are credited with crucial predictive power for markets and customer behavior. From this, banks could make use of their business areas in the future.

Nevertheless, on 18 June, Mr Ermotti emphasizes that customers and banks still have to be patient. So it would take another five to ten years until the breakthrough of Blockchain.

But then a change is on for sure. In the process, the blockchain will prove to the banking sector "as groundbreaking and radical as the [financial market] regulation of the past ten years."

Banks and the Blockchain: Together in the future?

While banks are believed to be the most threatened in their business model by DLT, experts believe that more and more financial institutions are focusing their attention on the potential of the technologies. A study by the US consulting firm Greenwich Advisors shows that the efforts of financial institutions in the blockchain sector more than doubled last year for example. A total of 1.7 billion US dollars should already be invested by banks in 2017 worldwide in the research and development of DLT solutions.

One of these banking hopes is the company R3. According to the consortium, over 200 financial institutions, regulators, trade associations and technology companies have joined forces. Among them sizes such as Microsoft, Barclays, HSBC and UBS. Their goal should be to develop blockchain solutions for business applications and especially for bank payments.

Furthermore, the Swiss are currently researching jointly with the US software giant IBM on a separate blockchain application. Their trading platform Batavia will provide secure financing for international goods traffic in the future.

The moves by UBS and the views of its CEO Sergio Ermotti highlight a global trend: Banks in particular have a firm grasp on the potential of distributed ledger technologies.

Source of this free translation: https://www.btc-echo.de/ubs-ceo-ermotti-nennt-blockchain-must-have-fuer-unternehmen-und-banken/



Best regards and hear you in my next article.

Michael Thomale - @michael.thomale

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