Jeremy Wilson, Vice Chairman of Barclays Corporate Bank: Blockchain can facilitate a new operating system

Rage Commentary : Barclays Corporate Bank Vice Chairman believes that blockchain can have an impact on almost everyone's life, not just in the financial field. He believes that blockchain technology should not be used in a mature field, but should be applied in some fields that need to overcome challenges and are inefficient, so that the effect can be more obvious and the difficulty of application will be reduced.

Translation: Nicole

Blockchain will go beyond finance and have an impact on 'almost everyone's' life, says Jeremy Wilson, vice chairman of Barclays' corporate bank.

“This will not only change the financial sector, but will directly or indirectly change almost everyone’s life,” he said at the Economist Financial Disruption Conference. “It may be exaggerated, but it has the potential to lead to a completely new operating system.”

Wilson participated in a panel discussion with financial technology entrepreneurs Adam Ludwin and Eric Benz, and blockchain guru Helen Disney. He brought his insights to the session from his experience at Barclays and as chairman of the Whitechapel think tank, a tool for governments, regulators and the private sector to address issues arising in the emerging blockchain ecosystem.

When asked if blockchain poses a threat to banks, Wilson noted:

“I don’t think I’ve ever heard at Barclays or Whitechapel think tanks that blockchain is a major opportunity for banks because it’s a major opportunity for everyone, not just for incumbents.”

Wilson said of the opportunity in technology:

“We better think about where blockchain can bring the most benefit. In my opinion, we have moved past the hype phase and we are now seeing some pretty significant business applications start to emerge.”

“I think the simple principle is this: Don’t try to use blockchain in a mature area. Apply it to areas where there are big challenges and big problems to solve. Look for areas where there are inefficiencies and high costs.”

New Solutions

Looking at areas of banking where blockchain is already having an impact, Wilson cites trade finance and capital markets – citing a recent breakthrough example: “Barclays has just done a pilot in trade finance, which typically involves a very long and complex supply chain. It’s a mature process that’s been developed for hundreds of years. The most inefficient part of it is a document called a bill of lading, which can take weeks to get to the other side of the world. If you use blockchain, you can revolutionize that process.

“In the capital markets space, it is becoming increasingly clear that blockchain can significantly address the inefficiencies and costs surrounding the transactional process of buying and selling securities.”

Jeremy Wilson

Wilson cautioned, however, that industry-wide adoption of blockchain technology will take time before its full capabilities are unlocked:

“It depends on the breadth of constituencies you have to address when you bring new features. If it’s a vast universe, then it’s going to take time. Usually things move much faster than we think, but I think it’s going to take another five to 10 years to see the technology become ingrained.”

Collaborate or perish?

The overall theme of the conference was “Collaborate or Perish,” which was particularly relevant in the context of blockchain discussions, as Wilson believes it is important for banks to work together to create industry standards so that new technologies can achieve the best outcomes.

“When you get a new technology like this that’s going to have such a profound impact, you’re going to find a lot of different alliances and different gatherings and different forms of collaboration and, of course, a lot of competition. If you look back at Betamax and VHS, those standards were in conflict with each other, and we’re going to see a step in that direction. But I think there needs to be a real attempt by the banking industry to make sure that doesn’t happen. So you have to have significant collaboration to avoid conflicting situations.”

Barclays is supporting a number of blockchain innovations, both internally and through incubators. When asked about the probability of “backing the winner,” Wilson said:

“There’s a whole community of investment banks, capital funds and angel investors who are backing the horse when it doesn’t make it to the finish line. But that’s the nature of innovation at this scale. It’s absolutely right that this kind of innovation should be nurtured and developed, and that banks should bring these institutions together to compete vigorously when it’s time to compete, and to collaborate when it’s time to collaborate.”

Wilson is Vice Chairman of Barclays Corporate Bank, responsible for: working with the Board or Executive Committee and Barclays’ key corporate and institutional clients; representing Barclays on industry initiatives; and representing the financial services sector on global and regional industry bodies.

He is also co-chair of the Whitechapel Think Tank and a member of the World Economic Forum’s Global Futures Council on Blockchain. He is chair of the UK Government Engagement and Advisory Group; chair of the Banking Environment Initiative Working Group; and a trustee of various charitable trusts covering banking and education.