This is where blockchain comes in. According to the Financial Times article, four of the world’s biggest banks UBS (UBS) , Deutsche Bank (DB), Santander (SAN) and BNY Mellon (BK), along as well as broker ICAP IAPLY, teamed taking place to create a sort of “minister to agreement coin” and arena the idea to central banks.
Such a bargain method would eventually set sights on that trades anywhere could be recorded and cleared electronically, safely and speedily. Therefore, there would be no actual showing off, at least technically, for clearing house to be based in a steadfast jurisdiction. The paper said the four banks dream to have a public publication firm ready by 2018.
This would be just in period for London-based banks. If the U.K. triggers Article 50 of the EU Treaty, which is the credited notification that it wants to leave the block, forward as well as year as Prime Minister Theresa May suggested, it has two years to negotiate its dissolution. This technology, if indeed it turns out to be what it promises to be, could come occurring following the maintenance for a mighty advantage to the City of London. Banks will be clever to argue that they no longer habit to have an effect on their headquarters to Frankfurt or Paris, back they can have a concentrate on colleague behind the ECB from London, subsequent to the benefit occurring of this technology.
Of course, this is very theoretical, and would anyway unaided solve share of the problem that Brexit poses to banks in the U.K. The technology yet doesn’t take objective that banks will save their “passporting” rights — the right to assign their facilities in the EU — if the U.K. leaves, as this is a situation of regulation not technology. Also, the ECB is usually more conservative than totaling central banks, and it is not certain it would even come clean the technology.
However, the importance of the financial services industry to the U.K. cannot be understated. According to statistics from the City of London Corporation, an meting out promoting London’s role as a financial powerhouse, the financial services sector produces 9.6% of U.K. output, as soon as joined professional services contributing an subsidiary 4.9%.
For comparison purposes, the contribution of financial services to U.S. GDP is 7.6%, even if for the two biggest eurozone countries, Germany and France, is even demean yet, at 4.7% and 4.2%.
Britain is the biggest exporter of financial facilities in the world and the financial sector employs re two million people overall in the U.K. Any news that could potentially aspire that Brexit would not hit this vital industry too hard is terribly something worth clapping.