Blockchain, which led to the creation of digital currency Bitcoin, has been described IBM executive Robert Morris as a set of distributed ledgers with a majority consensus verifying the records.

The result is cheaper, faster and more reliable records that are more difficult to corrupt or change.

The technology is useful and has the potential to replace the current Swift system in which Bangladesh’s central bank recently lost $81 million to attackers after the central bank’s system access was compromised.

Swift is currently the world’s predominant fund-transfer system, operated by about 3,000 financial institutions around the globe.

Blockchain, however, also has many other applications that promise smarter transactions in the financial sphere and elsewhere.

Blockchains can be used along the entire length of supply chains to ensure sufficient verification and thus prevent fraud. Banking, stock trading, insurance, shipping and virtually any other transaction of values will be more efficient and secure. This, in turn, opens up new opportunities for businesses and industries.

First, according to IBM, blockchain services will help create and manage networks that power a new category of distributed ledger applications. These applications can access existing transactions to support new payment, settlement, supply chain and other business processes.

Second, Internet of Things data will be enabled on blockchain via devices such as WiFi location-tracking, barcode-scan events and device-reported data. These devices can then communicate with blockchain-based ledgers to update or validate smart contracts.

This could be applied, for example, in the movement of an Internet-connected package along multiple distribution points.

In other words, the technology will likely change the entire global logistics business.

In developing new blockchain applications, IBM has also worked with the London Stock Exchange to improve management of risks and increase transparency in global financial markets.

In Thailand, both the central bank and the SEC are preparing measures to facilitate and regulate the coming wave of fin-tech start-ups, such as those planning to offer peer-to-peer lending, crowd-funding and other new forms of financial and related services.

These start-ups have the potential to change the landscape of financial services in the Thai market and become new competitors to existing services provided by banks and other financial institutions.

For example, a peer-to-peer lending service may compete against existing automobile-leasing services as social media offer up a group of potential lenders to someone who wants funds to buy a new car.

Rather than applying for an auto loan with a traditional leasing firm, the person may go to social media and apply for a peer-to-peer loan on a reputable start-up platform which can digitally link, say, 10 potential lenders with the car buyer who’s requesting a loan.

This new way of getting and providing car loans may be available shortly as regulators forge a new set of rules and regulations for the digital economy.

Nophakhun@nationgroup.com