The financial services industry is being constantly challenged with new regulations and outside threats. Two important developments in the financial world recently that are worth noting are the immense growth in blockchain technology utilization, as well as the impact of the Financial Accounting Standards Board’s (FASB) recent comments on Current Expected Credit Loss (CECL) guidelines. These are both undoubtedly items to keep top-of-mind, as they are impacting institutions from community banks and credit unions to the large banks.
Currently, more than forty leading financial institutions along with top firms across other industries are experimenting with blockchain technology as a wayto safely and securely track assets. This is adevelopment that will not only reduce the risk of fraud, but increase the speed of data transfers. For those reasons, among others, blockchain technology is certainly worth paying attention to.
Beyond its distributed ledger capabilities, blockchain will also soon play a key role in identity protection and privacy. Imagine a world where you no longer have to remember passwords. You have an encrypted identity where you are the only one that stores your personal information. When logging into a site, you would need only to present necessary attributes and nothing else, such as your age, but not your actual birthday. This optimizes privacy, as those receiving your attributes have no way of correlating them with your other, unshared attributes. In this new world, the person is in complete control of their personal information. The great news is that credit unions have a wonderful opportunity to be on the forefront of this new wave by being the issuers of the sovereign identities.continue reading »