Despite overseeing technology at the bank with more blockchain patents than any other, Bank of America’s Chief Operations and Technology Officer Cathy Bessant is “bearish” on the technology, she told CNBC on March 26.
While saying she is “open-minded” about the technology, she called blockchain a technology in search of a use case, adding, “All of the big tech companies will come and say ‘blockchain, blockchain, blockchain.’ I say, ‘Show me the use case. You bring me the use case and I’ll try it.’”
The only uses she has seen so far, Bessant adds, are for individual or small sets of transactions.
Not everyone agrees. JPMorgan recently debuted its JPM Coin stablecoin, designed to speed the settlement of international financial transactions at a far lower cost than is currently possible.
And on March 26, research firm Research and Markets released a report detailing 76 potential blockchain growth areas across 11 industries. It predicts that blockchain spending will grow from $3.1 billion today to more than $41 billion in 2025, a compound annual growth rate (CAGR) of 44.5 percent.
The industries covered in the Research and Markets report are banking and finance, insurance, healthcare and pharmaceutical, retail, automotive, defense and aerospace, construction, public sector, professional services, agriculture, and energy and utilities.
In the banking and finance space, these uses include: KYC data and due diligence, trade finance, capital markets, initial coin offerings, fraud detection, cross border payments, risk management and compliance, and loan management. Supply chain management is the most common use case cited in the majority of financial sectors covered in the report.
That comes on the heels of a March 4 report by market intelligence firm International Data Corporation (IDC), which predicts blockchain spending will nearly double in 2019 to $2.9 billion.
It predicted two use cases in the financial markets—cross border payments and settlements, and trade finance and post-trade/transaction settlements—for $738 million of that.
As for Bank of America, Bessant said that the aggressive investment in blockchain technology represented by its collection of 82 patents and patent applications is, “to reserve our place in the IP chain for, or if, blockchain fulfills what some people believe its potential is.”