Cryptocurrencies such as Bitcoin rely on cryptography and a decentralised peer-to-peer network. There are now over 600 identifiable alternative cryptocurrencies (also known as AltCoins), such as Ixcoin, Ripple, LiteCoin, Dogecoin, Primecoin or Riecoin.
The essential cryptocurrency innovation is a public blockchain that eliminates the need for a central counterparty to act as a third party to financial transactions. Trust in a counterparty changes to trust in the technology. Blockchain technology is interesting in that if provides a public ledger containing the full history of transactions, is secure and private and seems indestructible. However, blockchain technology is only a subset of mutual distributed ledgers, a field in which Z/Yen pioneered in 1995.
Distributed ledgers technology are being applied to other sectors of activity including finance. Ideas for further applications include corporate voting, smart contracts, registries (ships, aircraft, tax, artworks etc.), identity blockchains for anti-fraud protection or anti-money laundering.
- MetroGnomo – an open-source experimental timestamping service based on Z/Yen's ChainZy mutual distributed ledger technology. MetroGnomo’s replicated authoritative immutable ledger improves coordination, cooperation, integration and dispute resolution between firms through the provision of impartial timing information and unique universal identifiers. More Information...
- IntereXchainZ: building on the successful InterChainZ project, IntereXchainZ extends mutual distributed ledgers to build a functioning marketplace.
- Distributed Futures Forum - a forum for senior people to meet and network with a group of their peers four times a year and share intelligence on mutual distributed ledgers, cyrptocurrencies, blockchains, FinTech, RegTech, and other interesting topics where disruptive technology meets finance.
- The Impact and Potential of Blockchain on the Securities Transaction Lifecycle - there is considerable interest in the potential use of ‘blockchain’ in the settlement of securities transactions. Proponents argue that the use of cryptographic security tools to create blockchains (sequential, digitally signed and validated records of ownership) can allow almost instantaneous post-trade delivery against payment (DVP), thus radically simplifying post-trade processing and substantially reducing both costs and operational and liquidity risks. The SWIFT Institute has commissioned Professor Michael Mainelli & Professor Alistair Milne, Loughborough University School of Business and Economics, to examine the impact and potential of blockchains and mutual distributed ledgers on the lifecycle of securities transactions. More information...
- InterChainZ - a new research consortium collaborated between July and October 2015 to look into potential uses for distributed ledgers in a number of financial services.
- Chain of A Lifetime: How Blockchain Technology Might Transform Personal Insurance - a research project carried out between August and December 2014 which explored how blockchain technology might transform personal insurance and in particular interactions among individuals and insurance companies over time.
Related Articles & Reports
- Michael Mainelli: "Unblock The Shared Economy", Duke Dialogue, Lid Publishing (September 2015)
- Michael Mainelli: "Stranger Danger: How To Unblock KYC and AML in Banks", iGTB (August 2015)
- Michael Mainelli: "The Temple & The Souk – The Future Of Mutual Distributed Ledgers", iGTB (July 2015)
- Michael Mainelli and Chiara van Gunten: "Chain Of A Lifetime: How Blockchain Technology Might Transform Personal Insurance", Long Finance (December 2014)
- Michael Mainelli: "Infectious Transactions From Travels Abroad". iGTB (June 2014)
- Michael Mainelli and Bob McDowall: "Building Bit - What's A Poor Government To Do About AltCoins?", Banking Technology (April 2014)
- Michael Mainelli, Stephanie Rochford and Chiara von Gunten: "Capacity, Trade and Credit: Emerging Architectures for Money and Commerce", report prepared by Z/Yen Group for the City of London Corporation, ESRC and Recipco (December 2011)
- 12 October 2015: "Music TechPitch 4.5 - Blockchain Technology & Data", 2Pears.
- 18 September 2015: "Sharing Ledgers for Sharing Economies: What Blockchain Technology Might Mean for Financial Services", PwC Central Bank Forum.
- 24 June 2015: "Shared Ledgers For Shared Economies", Financial Services Club at Barclays Accelerator, London.
- 2 June 2015: "Blockchain Masterclass", FinTech Circle at BNY Mellon, London.
- 15 April 2015: "PRMIA Webinar - What Blockchain Technology Might Mean For Risk Management In Financial Services", PRMIA.
- 09 February 2015: "Tomorrow's Transactions", NESTA & Hyperion Consult, London (Michael Mainelli's presentation, "Chain Of A Lifetime").
- 13 June 2014: "Bitcoin and other cryptocurrencies: technical, monetary, policy and development context", Geneva Internet Platform seminar, Geneva (Z/Yen presentation, event video).
- 14 May 2014: "What Might Blockchain Technology Might Mean For Traditional Financial Services", Long Finance & Interxion seminar, London.