Blockchain networks can lower transaction costs and improve transparency
Blockchain is an electronic ledger of payments that is shared between parties on servers and does away with the need for a central authority, writes William Mzimba
In a significant development for the digital economy locally, SA’s largest banks swapped an asset for the first time using a blockchain network late in 2016. The transaction, which essentially entailed a smart contract being distributed using an open-source platform on a network of all the main banks as well as the central bank, was reported to be a success as well as a great platform for learning. Collaboration is going to be crucial to the success of blockchain solutions in future and it is very positive that a local working group, as well as recent announcements of some of our major banks joining international working groups, are being set up to co-create the optimal solution for the industry. The smart-contract solution is expected to result in cryptocurrencies being combined with smart contracts to lower transaction costs, speed up settlement and improve transparency. However, unlike many of the traditional solutions in this space, banks will want them linked to legal tender. T...
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