Goldman Sachs plans to use blockchain for foreign exchange trades

posted about 6 years ago
Trading currencies is costly and slow for traders at major financial institutions—transactions need to go through a bunch of middle men, each of which take a slight fee. A new patent application from Goldman Sachs hints at how the blockchain technology that is behind bitcoin could revolutionize that process.

The patent application, published by the US Patent and Trademark Office (USPTO) on Sept. 8, 2016, was originally filed in March 2015. It outlines a distributed ledger (essentially an accounting ledger shared by a number of different parties, also known as a blockchain) that can process financial transactions in the foreign exchange market.

It’s Goldman Sachs’ first blockchain-related patent (though another patent application published in Nov. 2015 showed the investment bank was looking at a bitcoin-esque digital currency for traders).

Goldman wants to merge the benefits of blockchain technology—speed and efficiency—with other technologies that offer privacy, security, and compliance with regulatory guidelines. For example, Goldman’s version of the blockchain would allow for private transactions only visible on a need-to-know basis; permit regulators to access the database; and adhere to AML and KYC laws, which require that banks confirm the identity of their customers.
Tags: blockchain, news