UBS CEO Ermotti calls blockchain “must-have” for companies and banks

HOME TECH BLOCKCHAIN UBS-CEO ERMOTTI CALLS BLOCKCHAIN “MUST-HAVE” FOR COMPANIES AND BANKS
Sergio Ermotti, Managing Director of the Swiss banking giant UBS, thinks a lot of the Blockchain. In an interview with the US news channel CNBC, he predicts a bright future for distributed ledger technologies this week, especially in the financial sector. For banks in particular, these technologies represent a groundbreaking opportunity. For companies, they have almost become a “must-have”. Meanwhile, more and more financial institutions worldwide are focusing their attention on the potential of the blockchain.

UBS CEO Sergio Ermotti is anything but a crypto fan – the Swiss has proven this several times in the past. However, this does not distract him from the blockchain technology behind the crypto currencies. What’s more, in an interview with the US business intelligence agency CNBC this week he emphasizes the special potential of the blockchain for the banking sector.

“The blockchain is almost a must-have. Technologies will [in the future] free up resources and make us [banks] more efficient. The blockchain is a great opportunity that allows us to reduce costs.”

The same Bitcoin news are necessary as long-term business pressure on banks is growing

In times of flourishing digitalisation of the entire financial sector, they are confronted with dwindling profit margins. Particularly in the Bitcoin news, more and more private companies are outpacing traditional financial institutions like this: https://www.onlinebetrug.net/en/bitcoin-news-trader/.

“Our industry will continue to be under pressure in terms of gross margins. There is no doubt about it. The only way to remain relevant is not only through capital, products, employee quality and customer service. You also have to be able to derive the right prices from this,

said the UBS Managing Director about the advantages of the upcoming blockchain application. In addition to the adaptation in the transaction business, distributed ledger technologies (DLTs) are said to have decisive predictive power for markets and customer behavior. In the future, banks could make use of this for their business areas.

Nevertheless, Ermotti stressed on June 18 that customers and banks still have to be patient. It would take another five to ten years for the blockchain to break through.

Then, however, the 58-year-old is certain that there will be a breakthrough. The blockchain will prove to be “as groundbreaking and far-reaching for the banking sector as the [financial market] regulation of the past ten years”.

Banks and the blockchain: Together into the future?

While banks are believed to be the most clearly threatened by DLT in their business model, more and more financial institutions are focusing on the potential of the technologies. For example, a study conducted last week by US consulting firm Greenwich Advisors shows that the efforts of financial institutions in the blockchain sector more than doubled last year. A total of 1.7 billion US dollars are said to have been invested by banks worldwide in the research and development of DLT solutions in 2017.

One of these banking hopes is the company R3. According to the consortium, more than 200 financial institutions, regulators, trade associations and technology companies have joined forces. Among them are such big names as Microsoft, Barclays, HSBC and UBS. Their goal will be to develop blockchain solutions for business applications, especially banking payments.

Furthermore, the Swiss are currently researching their own blockchain application together with the US software giant IBM. Their trading platform Batavia is intended to put the financing of international goods traffic on a secure footing in the future.

This week, UBS’s initiatives and the assessments of its Managing Director Sergio Ermotti underscore a global trend: banks in particular are keeping a close eye on the potential of distributed ledger technologies.