Although asset managers initially explored Bitcoin as a new investment opportunity, it is digital securities settlement infrastructure inspired by Bitcoin’s underlying technology, blockchain, that may have a greater impact on buy-side firms.
Blockchain technology could deliver settlement at will and enable greater degrees of straight through processing. As a result, buy-side firms could decrease operational costs and improve counterparty and liquidity risk management. These cost-savings and added efficiencies would enable them to become leaner and more focused. Asset managers — and consequently investors — have good reason to be excited about this new technology.
