Major banks world over are recognizing the potential of bitcoin and the underlying bl0ckchain technology. They are setting up innovation labs to explore into this technology that can revolutionise the financial sector.
Speaking to Business Insider, Derek White, Barclays chief Design and Digital Officer who supervises bitcoin and blockchain technology at Barclays, opened up about the bank’s plan with this technology.
“As a heritage organisation we can either embrace disruption or be disrupted,” said White. “We’ve chosen to embrace disruption. We’re increasingly becoming a technology financial services company, not a bank with a technology division.”
He is very excited about the blockchain technology in particular. It is the software that both powers and regulates bitcoin. It uses open ledger technology, meaning all of the transactions are free for anyone to look at.
White says: “We fundamentally believe that the world is shifting from closed to open – closed architecture to open architecture, everything moving to the cloud; closed networks to open networks; closed systems to open systems.”
The blockchain is not only quicker and cheaper to send and receive money, but is also transparent as anyone can theoretically check to see if someone’s using stolen bitcoin.
Barclays has set-up two bitcoin “labs” above old branches in Notting Hill and Old Street that are open to bitcoin and blockchain entrepreneurs, businesses, and coders.
White says: “It’s a new technology, we know a little bit about it but we wanted to learn more from the creators of it. They could see our genuine interest in the technology and they could see we weren’t looking to just sponsor, we were looking to shape.”
Alongside working with startups, the bank is experimenting with the technology internally.
White says: “We looked at how many experiments we wanted to do internally with the blockchain. The first wave led to 22 experiments, we’ve now got over 45 experiments our businesses want to do.”
Enabling charities to accept bitcoin is just one of the ways of Barclays’ meddling. Its bankers are also mentoring 3 bitcoin startups out of the current group of 10 companies on its current Barclays Techstars Accelerator programme, which aims to help fintech startups grow.
White says: “We’re working with HMT to share how we see the blockchain and cryptocurrencies, and bringing to life potential use cases that we are exploring.
“The UK policy makers and regulators are both very much on the front foot of wanting to understand this. They want to understand it to make sure they’re protecting UK citizens are putting the right regulation around it.”