HomeLatest NewsSantander Creates Working Group to Experiment with Blockchain Tech

Santander Creates Working Group to Experiment with Blockchain Tech

Santander, one of the world’s biggest banks and the second largest in Europe, has set up a team dubbed ‘Crypto 2.0’ to carry out experiments with the Bitcoin blockchain. The bank is investigating how it could use the distributed ledger for international payments and smart contracts.

“We have internally identified 20 to 25 use cases where this technology can be applied,” Mariano Belinkey, head of Santander InnoVentures told Business Insider at MoneyConf.

“We’re very excited about distributed ledgers and blockchain technology. They really have the potential to disrupt many of the basic processes we have underlying our transactional products.”

Julio M. Faura, head of innovations at Santander, said the first use case the bank is exploring is payments, particularly international payments, but added that Santander is also interested in smart contracts, which he said “have the potential to transform many of the other things we do.”

Santander InnoVentures, the bank’s US$100 million fintech investment fund, has recently released a report called ‘The Fintech 2.0 Paper: rebooting financial services‘, a call to action on banks and fintech startups to collaborate.

Co-authored with Oliver Wyman and Anthemis Group, the document argues that distributed ledger technologies could reduce banks’ infrastructure costs by up to US$20 billion a year.

“Our analysis suggests that distributed ledger technology could reduce banks’ infrastructure costs attributable to cross-border payments, securities trading and regulatory compliance by between $15-20 billion per annum by 2022,” the report reads.

“Distributed ledgers eliminate the need for central authorities to certify ownership and clear transactions. […] Commercial banks, central banks, stock exchanges and major technology providers […] are all exploring the potential uses of distributed ledgers. Fintechs […] are also developing new ways to exchange data and assets enabled by the technology. It is only a matter of time before distributed ledgers become a trusted alternative for managing large volumes of transactions.”

Many have argued that distributed digital ledgers have the potential to make business models more efficient and change how our financial world operates, including former JP Morgan credit default swap pioneer, Blythe Masters. However, Belinkey believes that we won’t get there over night.

“While getting to a working prototype could be something that we do within months, getting to an actual product that regulators say is good to go and the compliance guys like — that will take a while,” he concluded, suggesting that it should take couple years before banks eventually adopt implement blockchain technology.

Santander’s interest in the bitcoin blockchain follows the news of three of Australia’s “big four banks,” namely Westpac, ANZ and the Commonwealth Bank of Australia, which are currently trialling Ripple payments for faster and cheaper international payments.

Accepts customers from the USA
Offers 15 crypto coins to buy&sell including BTC, LTC, ETC, NEO and more
Trade on the world's leading social trading and investing platform
Open My Account

We use cookies to personalise content & ads, provide social media features and offer you a better experience. By continuing to browse the site or clicking "OK, Thanks" you are consenting to the use of cookies on this website.