by Lori Brown
In a bold and encouraging move forward, HSBC along with The Bank Of China Hong Kong have publicly addressed their plans to implement blockchain technology in select mortgage services and property valuation models by mid-November 2016. This veer towards the brilliant blockchain “Tech-topia” is a result of the substantial resistance from regulators in big banking, according to Duncan Wong from the government-backed technology company, Astri.
On the development, Wong explained:
“To the best of our knowledge, this will be the first production-grade [blockchain] mortgage system to integrate with a bank… The reason we focused on the property valuation is because there is less regulatory concern for this.”
He also added that there was a plan to eventually build a system including more sensitive legal documents. It appears that the rewards of blockchain technology must far outweigh the potential risks, because, in spite of a notoriously reluctant industry, banks and finance influencers are taking the plunge into a new, unshakeable way of keeping records and transacting globally.
As it stands, banks hire surveyors whenever a mortgage is purchased. However, as consumers shop around for the best buy, a property may be valued numerous times by different surveyors. However, this latest development will see the blockchain enable a decentralized network of banks and surveyors. This means that the latest valuations can be listed, shared and verified in a very short amount of time, addressing inefficiencies present within the mortgage industry.
In June 2016 Cian Burke, the Head of HSBC Securities Services said:
“Practicality poses a real obstacle to scaling blockchain; there could be cultural, financial, regulatory and reputational hurdles too. But in the long term, the opportunities should outweigh the challenges. We (at HSBC) expect blockchain investment to continue to evolve rapidly, and unpredictably, over the next few years.”
Amidst the growing buzz of cryptocurrencies, the newness of the technology from which it all came continues to amaze and baffle the world. Blockchain technology is a marvel to study, and for millions of digital currency users, blockchain technology is the pride and centerpiece of its popular pioneer, Bitcoin. The blockchain has been stunning the geniuses of the world in exponentially growing numbers in 2016. This is evidenced by the sharp incline in interest in the concepts and methods blockchain technology offers, such as the latest application to develop a decentralized network of banks and surveyors.