Martin Walker, the UK director for the non-profit Center for Evidence-Based Management (CEBMa), has called blockchain technology a “fad” in an address to the British Parliament’s Select Committee.
Walker’s comments were made in stark contrast to representatives also present at the meeting from blockchain companies Everledger and Ripple, and a researcher from King’s College London, all of whom spoke of the potential benefits of the technology, in that it could save the banking industry millions of dollars.
He made his comments on Tuesday to a room full of British MPs, while giving evidence to a House of Commons Treasury Committee, adding that he saw the new technology behind cryptocurrency as nothing more than “magic wand, pixie dust things”. Walker went on to say that blockchain was “a distraction from looking at getting some of the basics rights” in the banking industry.
The CEBMa director had worked previously as a consultant to the R3 blockchain consortium, which has complete trials for financial institutions and major banks across the globe. He went on to tell the Treasury Committee that “in terms of demonstrable benefits” of the blockchain, there’s “little to nothing.” He went on:
“All that it takes to make a credible idea into a fad is people just switch off their brains and stop thinking. Over 20 years in and around the banking industry — blockchain is a fad, but I have seen many fads in my career.”
Economist Garrick Hileman from the University of Cambridge says that data now shows that central banks are active in their interest in blockchain technology and many are trialing it for a variety of different cases, including new central bank digital currency, new payment systems and records management. He argues:
“If you’re a central bank providing critical infrastructure – payment systems, thinking about maybe moving away from physical cash to a completely electronic money-based system, having a technology that is resilient and will have zero downtime is actually really important.”
On the drawback side, Hileman points out that although Bitcoin is famous for offering high levels of privacy, blockchains can leak data and it is possible to find out “who’s doing what”due to it being on public record.
This week saw a major move from Australia’s biggest stock exchange (ASX) which announced its decision to go ahead with using of blockchain technology with plans to replace its current clearing and settlement system with a DLT model within the next two years.