On Thursday, the combined efforts of BME and Renta 4 Banco bore significant fruit when their new blockchain platform was able to successfully exchange digitized certificates without the need for an actual physical certificate to be exchanged. The entire process occurred through “digital” certificates, which were able to accurately make the transaction, and do so in a manner that was recognized by systems across the globe.
This was a dramatic moment in the history of blockchain technology, as the platform was able to properly recognize and release the amount pledged from Renta 4 Banco to BME to cover a transaction. This was all done without any kind of physical document needed for proof that the transaction occurred.
That this proof of concept worked is a game changer in the financial industry. No longer will there need to be physical certificates proving transactions, allowing these transactions and access to them to occur in real time. Digital currency exchanged from one party to another would show instantly, giving the second party access to those funds right away.
While not perfect, the process worked effectively over 80% of the time according to the report. This “success” has opened the door for them to expand their research and development, looking for 100% end to end process accuracy.
BME has been buoyed by the results. All parties involved in the transaction were seeing information related to the transaction in real time. The agreements between financial institutions or other entities were seeing the details of the transactions immediately. That was a significant result, something that had not been achieved previously when dealing with cryptocurrencies.
This idea was first conceived at DLT-Lab, a subsidiary of BME. They were looking for ways to connect capital markets using blockchain technology. Many factors were considered when designing the platform as explained by Berta Ares, head of digital transformation at BME. They stated:
“DLT technology allows us to reduce times drastically and improve the operation and control of the system, providing legal certainty for electronically generated certificates and maintaining privacy and compliance with the General Data Protection Regulation.”
While this is a big step forward, there is still work to be done. The truth is that 80 percent is not an acceptable rate. All transactions were properly recorded in time, but the goal is to get 100 percent real-time success. Ares added that this is the next stage that will be addressed. The hope is that they will be completely successful by the end of 2019.
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