The post Breaking down financial silos: How blockchain unifies money, securities, and commodities appeared on BitcoinEthereumNews.com.

Digital asset leaders from JP Morgan (NASDAQ: JPM) and Citi (NASDAQ: C) recently discussed the current innovation as well as the limitations of digital currencies, blockchain technology, and bank accounts. Omar Farooq, who heads up Onyx by JPMorgan, identified assets living in different silos as a key challenge. “One of the macro limitations is silos. So money is in a silo, securities are in a silo, commodities (are in a silo). You can just go across asset classes, everything lives in its own silo. And those silos don’t easily talk to each other. That’s why a lot of the settlement might take a day or two or longer,” Farooq said. Farooq also highlighted how JPM Coin transactions have exploded since they introduced programmability in 2023. He said that transactions have increased at least 10x and possibly up to 100x. He noted that most of them were small, casual transactions, giving the example of an industrial printer that gets paid every time it prints. So, programmability and interoperability are clearly in demand, and the biggest banks and asset managers in the world are beginning to see the vision. But are the current crop of blockchains capable of delivering? The original Bitcoin protocol can deliver on the dream The main problem with popular blockchains like Ethereum and Avalanche, which enable programmability, is scaling limitations. Despite almost a decade of promises out of the Ethereum camp, the blockchain can still only process 20 transactions per second, and the fees fluctuate wildly. Paying a $30 transaction fee obviously kills the example use case of paying an industrial printer every time it prints, and 20 transactions per second isn’t enough to run even a minor payments system, let alone all the transactions in the world. Programmability is indeed revolutionary, but it’s no good if the…

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Filed under: News - @ June 6, 2024 6:18 am