THELOGICALINDIAN - Regulators havenot consistently agog on blockchain technology but afresh they accept started to seeing its abeyant allowances A Hong Kong regulator has adumbrated how the blockchain can advice banking institutions to affected money laundering
Also read: Antonopoulos: ‘Meteor’ Bitcoin Doesn’t Compete Against ‘Dinosaur’ Banks
The capital ancestry of blockchain technology accomplish it a able-bodied band-aid to action money laundering. Not alone is a blockchain transparent, but it additionally prevents alike transactions, and it can abate the accident of fraud.
Hong Kong bazaar regulator Benedicte Nolens feels this technology should be acclimated to accede with AML and KYC regulations, rather than be subjected to it. Nolens explains:
The big catechism again becomes how the blockchain will be acclimated to abode money laundering. Complying with KYC and AML adjustment via this technology can aftereffect in absurdity abridgement through automation. Additionally, a almanac for all checks agitated out per alone applicant can be stored on the broadcast ledger.
Whether or not banking institutions will jump on Bitcoin technology all of a sudden, charcoal to be seen, though.
There are no specific authoritative guidelines for this technology in Hong Kong, which makes banking players alert of ambidextrous with it.
Nolens affirmed that altercation by adage banks should ensure any use of the technology complies with the rules. Moreover, it takes time to apparatus a blockchain-based band-aid into the existing coffer infrastructure. It is actual able-bodied accessible it will booty several added years afore blockchain is actuality adopted.
Then again, Nolens feels the banking areas not accepted in aback offices may be the aboriginal key areas to embrace distributed ledgers.
Considering there are various initiatives underway to accompany blockchain technology to the banking sector, it is pertinent these efforts alpha delivering. There are no concise assets area the blockchain is concerned, but accustomed the bulk of allotment abounding to these startups, a ancestor can’t be delayed forever.
But there is addition acumen as to why startups arrest the banking ecosystem are not succeeding.
Private blockchain solutions will not work, nor will their permissioned counterparts. Immutability is a axiological basic of preventing money laundering, and alone the open blockchain can accommodate that trait.
This leaves banking institutions with two choices as far as application a blockchain-based band-aid is concerned: Bitcoin or Ethereum.
Neither of these cryptocurrencies is accepted amid bankers back they cannot apply ascendancy over them. Nor can they ascendancy an open blockchain, yet they can body new applications and casework on top of one. Addressing money bed-making with broadcast ledgers will crave an accessible solution, with added privacy-centric features.
What are your thoughts on application the blockchain as a apparatus to action money laundering? Let us apperceive in the comments below!
Source: SCMP
Images address of Benedicte Nolens, Shutterstock.
