Business 19 February 2019Admir Aljic
IBM enters into a new blockchain deal with Santander
When most people think of IBM, they think of a computer giant that helped to bring about the modern age. However, the Fortune 500 company is quickly making their mark in other areas, helping them to remain one of the leading companies globally.
This rise continued this past week when IBM inked a deal with Banco Santander. The five-year deal will garner the company $700 million in revenue in exchange for implementing the bank’s hybrid cloud strategy.
A Deal That Makes Sense
Banking analysts have long felt that Santander was in need of an upgrade to their cloud technology. With financial institutions finding cloud services to be an ideal platform for maintaining records and with the ever growing concern about hackers stealing those records, Santander found themselves in need of a company that could provide them with the services and security that was needed.
The deal goes beyond providing cloud technology. A major feature is the use of blockchain technology and artificial intelligence. Blockchain appears to be the key technology going forward, as its also the founding technology of revolutionary cryptocurrencies.
Blockchain technology has been used to keep track of large volumes of transactions in a secure, efficent manner. Since there is no centralized warehouse to keep track of who has currency and how much they have, the use of blockchains has helped to provide a means by which records of transactions can be maintained.
Combined with the use of cloud technology, blockchain technology becomes the ideal forum for large numbers of records to be maintained. This is why IBM has made it a key to their new platform. Blockchains enable Santander to secure specific sets of data on the cloud, by breaking them into time stamped, encrypted transactions where only certain users would have access.
This also enables Santander, as well as other financial institutions, to prepare to handle cryptocurrencies. By using a platform that is already common in the digital currency world, these financial institutions will be light years ahead of their competitors when greater regulation is implemented regarding this medium.
This is considered to be one of the key features in adding security, especially in a world where hackers are becoming a major issue for all businesses, especially financial and medical. Without that private key, hackers would be deprived of the ability to gain unauthorized access, giving the financial institution a technological advancement that is sure to protect their records.
Many companies jumping on board
Several financial institutions had already turned to IBM as their hybrid cloud provider. This included the Bank of the Philippine Islands, BNP Paribas, and Lloyds Banking Group. In all, IBM is expected to make nearly $3 billion in total revenue from recent contracts.
This deal also solidifies IBM as the leader in providing such technology to the financial industry. Out of the top 20 financial institutions according to the Fortune 500, Santander became the 19th to sign a contract with IBM.
With the inclusion of an improved cloud experience and the use of blockchain technology, IBM is providing an improved experience for financial institutions that is setting it apart from competitors. It is not surprising that they are dominating this particular market.
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