Beyond the Crypto Craze: The Rise of Blockchain Technology

Beyond the Crypto Craze: The Rise of Blockchain Technology


Hardly a day goes by where we don’t see headlines about Bitcoin, the rise of cryptocurrencies, and the emerging technologies fueling the craze – we shared a post on the topic earlier this year titled “What is Bitcoin actually worth?”. In this post, we’d like to take a deeper dive into the technology that supports Bitcoin and cryptocurrencies known as blockchain. The emergence of blockchain technology may be reminiscent of Buffalo Springfield’s famous song lyrics; “There’s something happening here. But what it is ain’t exactly clear.” Our hope for this post is to share a deeper look at what that something is, and why we as financial planners are paying attention to this disruptive technology.

What is blockchain and why should we be paying attention?

Technologically speaking, a blockchain is a digitized, decentralized, public or private ledger of transactions or records. Blockchain is steadily growing as ‘completed’ blocks (the most recent transactions or records) are added to it in chronological order. What makes a blockchain system innovative is that it doesn’t run on just one computer like a regular database. Rather, it runs over many distributed processing nodes. Every node has a full copy of the blockchain, and the system requires all the nodes to establish a consensus about its contents; thereby verifying the authenticity of the database and its contents. The consensus among technology experts is that it’s difficult, if not impossible to change the blockchain without others finding out and correcting it.1

What makes blockchain different?

In our society, we rely on trusted third-party organizations such as courts, banks, financial institutions, and governments to process and keep official records of transactions. These third-parties are trusted because we rely on them to maintain the databases necessary to store our most sensitive data and to facilitate business. The integrity of their databases is only as strong as the physical and cyber security protection they provide. If they fail, we suffer; a recent example of this failure is the Equifax data breach in September 2017.2

The blockchain is exciting because the integrity of the contents of the distributed ledger does not rely on any specific individual or organization. So, rather than leaning on trusted third-parties to facilitate record keeping and transactions, we would depend on blockchain systems. As such, blockchain technology has the potential to decrease reliance on third-parties, reduce the frictional cost of doing business, increase financial transparency and efficiency, lower the risk of cybercrime, and decrease the ability of cybercriminals to exploit sensitive personal data for gain.3

Three Ways Blockchain is Shaping the Financial World of the Future

1. Financial Service for Clients

Blockchain technology is drawing investments from major financial institutions; many of them are involved in the asset management profession. Large financial service companies such as Goldman Sachs, JP Morgan Chase, and Citi Bank have all seized on blockchain’s potential to both disrupt and enhance the financial service sector. Even the U.S. Government is exploring the use of blockchain to improve transparency and efficiency.4

One area drawing a lot of attention is client onboarding and account servicing. In today’s world, clients must provide a host of personally identifiable information for each separate financial institution they wish to do business with. Financial companies must comply with reporting requirements including anti-money laundering regulations, information security procedures, ongoing account monitoring, and a cumbersome transfer of asset systems known as ACAT. All these functions require meticulous record keeping, and separate databases maintained by each financial institution. This increases the frictional costs for consumers, creates a potential cybersecurity hazard, and can add days or weeks to accomplishing routine financial actions. 4

Enter the blockchain. Imagine you have a single profile with all the required personally identifiable information necessary to facilitate financial transactions stored on a central blockchain ledger. Trusted parties such as financial planners, banks, custodians, mortgage companies, insurance and loan companies would be granted access to your profile using highly secure cryptology. The system would enable a tamper-proof audit trail which would track changes to the blockchain, allowing instant verification of your identity. The consumer could apply for credit, an insurance policy, open accounts, transfer assets, or service existing accounts nearly instantaneously. Because the system is predicated on highly secure cryptology, many technologists believe blockchain can provide this level of security because of its unique characteristics.

2. Reducing Global Poverty

According to a World Bank report, three-quarters of the world’s poor are “Unbanked,” either because reliable banks don’t exist, they don’t serve poor populations, or those in poverty are reluctant to use banks due to high costs, distances to travel, or bureaucratic barriers. Seeing that there is a direct relationship between access to banking services and poverty, a host of startup companies are attempting to solve this problem by using blockchain to provide essential banking services to the world’s poor. These services include imagining new and more secure payment processing methods, using mobile phones for banking functions, microfinancing for small business, digital identity methods to help banks verify customer information, and cheaper currency conversions services.6,7

Another way blockchain has the potential to reduce poverty is to combat corruption. Because blockchain technology builds tamper-proof databases, the technology is being used to increase transparency within emerging countries’ government and financial systems. An example of this effort is to use blockchain to store property ownership records. Land grabbing or the illegal seizure of land by corrupt officials using falsified documents is a significant issue exacerbating global poverty. Because of blockchain’s unique characteristics, officials in emerging countries are looking to store property records on blockchain ledgers. This method of record keeping has the potential to make property records tamper-proof and transparent, thereby enhancing the property rights of the world’s economically vulnerable.8

3. Impact on Global Stock Exchanges

Stock exchanges around the world are exploring how best to leverage blockchain to improve costs and efficiency and to lower risks and improve security. Not surprisingly, NASDAQ, the world’s largest technology stock exchange, is leading the way in adopting blockchain. NASDAQ is implementing a series of projects exploring the potential of blockchain to support the trading of private stock, payment remittance, and mutual fund settlement. Experts believe the efforts by NASDAQ and others will create a faster, more reliable, effective marketplace with the net result being increased security and lower trading costs for investors.9

Blockchain May Come, But Some Things Will Stay the Same

As financial planners, we like to see ourselves as standing at the intersection between the global financial system and our client’s lives. The security of our client’s data, how the financial system functions, and what that means for our clients is crucial to us. As the financial system develops, how we interact with you and the ways you interact with us will also change. Much of the change coming is due to the advent of blockchain that will occur in the background of our lives. However, one day shortly, if the potential of blockchain comes to fruition, we will worry less about our data, spend less time servicing our financial lives, and have more time to pursue our Live Big lives. On the other hand, no matter how much technology changes, your team at Yeske Buie will always be here, as human beings, ready to help you navigate one of the most powerful forces in your lives – your finances.


  1. (ICFAI), P. B. (2018, March 18). Blockchain. Retrieved April 25, 2018, from
  2. Staples, M. (2018, April 23). Blockchain is useful for a lot more than just Bitcoin. Retrieved from
  3. Tkatchuk, R., Minkus, K., McClarty, I., & Berg, B. (2017, October 18). Is blockchain the ultimate weapon against cybercrime? Retrieved April 27, 2018, from
  4. Ozelli, S. (2018, April 27). US Government Implements Blockchain Programs to Improve Transparency and Efficiency: Expert Blog. Retrieved April 27, 2018, from
  5. Bendor-Samuel, P., & IDG Contributor Network. (2017, May 04). Is blockchain technology secure for your company’s transactions? Retrieved April 27, 2018, from
  6. Three Quarters of The World’s Poor Are “Unbanked”. (2012, April 19). Retrieved April 27, 2018, from
  7. Hyland, J. (2016, March 15). Unlocking blockchain for the underbanked. Retrieved April 27, 2018, from
  8. Kuznetsov, N. (2017, July 26). How Emerging Markets And Blockchain Can Bring An End To Poverty. Retrieved from
  9. How Stock Exchanges Are Utilising Blockchain Technology. (2018, January 09). Retrieved April 27, 2018, from