FINRA industry conference to discuss emerging chain technology


nnnPost Comment: The US Financial Industry Authority organizes the 2017 block chain seminar, where regulators and representatives of financial institutions participate in the potential and problems of the chain chain technology. Its wide applicability and potential to be unanimously approved, its defects have also been rational attention. Reference to the difference between the permissive block and non – licenseable block chains, the status quo and trade – offs. Proposed that only a wide range of cooperation in order to truly realize the technical potential.n
nnTranslation: Annie_Xun
nBlock-chain technology is also known as distributed book technology, a technology that will transform the future of the financial industry. In general, the block chain can create a continuous growth of the transaction books, can not be tampered with, through the system code to establish a mutual checks and balances system to ensure the authenticity of the new transaction. Its speed, built-in security, versatility combined with each other, can be used to build financial industry applications. Recently, the top US financial regulators and industry stakeholders participated in the 2017 Blockchain Symposium, organized by the Financial Regulatory Authority (FINRA). In a series of eye-catching meeting, small members to explore the advantages and disadvantages of this dynamic technology.n
nAlthough the block chain is in many forms, Kathy Wang of the Federal Reserve Board explains that the technology is often a combination of point-to-point networks, distributed data storage, and encryption. These functions enable the block chain participants to securely share the same information, such as running financial transactions that can not be deleted or modified. The historical account copy can be upgraded to reflect the newly completed transaction and be distributed to the participant at the same time. Todd McDonald of R3, a financial technology firm, explains that unlike the traditional counterparty that maintains a separate transaction record of form and content, the block chain provides a “golden version” of data, all of which are shared synchronously. The way the industry designs is based on the need to understand the information, so not all data is shared with all participants at once.n
nAll participants who hold a copy of the book are subject to regulatory responsibility because the real account is present on multiple parties, not one party, and the book revision must be approved by all the participants, and the chain-chain network is centered. Experts say de-centing can reduce cyber attack damage, which is usually directed against the only important database. Usually burglary would like to easily avoid the investigation, you must get the entire district permission, which increased the difficulty.n
nThe “golden version” concept also attracts regulators and industry team members. Regulators prefer real-time access to high-quality, non-controversial, standardized, non-tampering information database capabilities. They also promote the chain-chain technology to reduce the administrative burden and reduce the chances of accidents by instantaneous transmission of important transaction information related to all parties. Of course, the system input must be verified to confirm, allowing the user to confirm the reliability of the block chain record. It is easier said than done.n
nIndustry stakeholders are looking to increase the automation and accuracy of accounting, thereby reducing costs and trading disputes. The efficiency of the technology can also reduce the transaction payment and settlement time. For example, McDonald said that block-chain users can use “self-sovereign digital identity”, personal status and characteristics are pre-verified. This “digital identity safe” can be carried for use in multiple transactions. This feature can reduce the current turnover of each new transaction on the complex paper work. Industry participants also use block-chain coding to implement “smart contracts” that are automatically executed under certain conditions. Block chains show functionality in a number of areas, such as private equity financing, proxy voting, value trading, and countless other product innovations.n
nThe team members believe that the biggest two challenges of a chain-chain deployment are management and trust. The theoretical advantage of block-chain technology is that if it is used properly, it can ensure the authenticity of the transaction by encoding, creating a record that can not be tampered with, so as to realize automatic management. This system reliability can be derived from the fact that the famous block chain system is open or unlicensed. For some team members, it is unrealistic to let the financial system run in an autonomous, unlicensed network. So interested parties are exploring the feasibility of a licensed block chain network. Even if the management problem is resolved, the block chain also set up a safe and successful track record, in order to support the proven current US financial system trust.n
nJeffrey Bandman, who worked at the Commodity Futures Trading Commission (CFTC), explained that the CFTC in 2015 and 2016, in order to promote the development of confidence technology, will now enter a stage of active industry engagement. Other industry regulators involved in the seminar also seem to consider this. Many regulators discuss their “working hours” activities in multiple cities, giving regulators the opportunity to interact with participants to discuss block development and related enforcement issues.n
nOne of the biggest contradictions in the block chain is that although some regulators and financial institutions have expressed the desire to set up internal R u0026 D laboratories, test techniques, and participate in discussions, only the multi-party technology can be used to achieve its potential. There is no common use, synchronization: the data “gold version” of the benefits will no longer exist. The panellists believe that this cooperation will be broader after the technology has overcome the issue of management and trust. So the development of this good wish, the future of the block chain seems to be heavily pressed on the brave technical forerunner’s shoulders.n

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