A Brief History of Blockchain and What It Means for Wealth Management

1st January, 1970

A Brief History of Blockchain and What It Means for Wealth Management

It is no secret that Blockchain has the ability to transform the banking industry. But how can we fully understand its implications for Wealth Management if we aren’t clear on what it actually is?

Will the Wealth Management sector miss out if it doesn’t hop on the Blockchain train?

This article will briefly take you through Blockchain’s history and its future benefits for the Wealth Management sector.

The Brainchild of Satoshi Nakamoto

Originally devised in 2008, after Occupy Wall Street accused banks of misusing borrowers’ money, duping clients and rigging the system, Sastoshi Nakamoto was the pseudonym given to the person or group of people that effectively created Blockchain. Its original purpose was to accommodate the digital currency Bitcoin, but the tech community are now finding other potential uses for the technology, for example, how can Blockchain be implemented in the banking industry and what it means for the Wealth Management sector.

What is Bitcoin?

In a nutshell, Bitcoin is virtual currency or reference to Blockchain and transactions that can be made by check, wiring or cash. It is pioneered by an exchange of digital information that allows you to buy goods or services, known as Cryptocurrency. After the accusation by Occupy Wall Street, Bitcoin pioneers wanted to put the seller in charge, cancel interest fees and make transactions transparent. Despite the issues of transactional delays and high volatility, many people in third world countries find Bitcoin as their most reliable channel for receiving and giving money. Its peer-to-peer computer network allows transactions to have high security and the likelihood of corruption via a hacker is almost impossible.

A Google Docs Analogy by William Mougayar

Blockchain expert, William Mougayar, uses Googles Docs as an analogy to explain Blockchain. He states that today’s databases work in such a way that two people cannot edit the same document at the same time. Similarly, banks maintain money balances and transfers by, for example, briefly blocking access while transactions take place. However, with Google Docs, two people can edit the same document at the same time, which reduces the risk of losing track of changes and not being in sync with other versions.

Blockchain is Incorruptible    

Authors of Blockchain revolution 2016, Don and Alex Tapscott, state that “Blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value”. Blockgeeks explain simply, that you should imagine a spreadsheet that has been duplicated thousands of times across a network of computers and that network is then designed to regularly update the spreadsheet. This peer-to-peer process means that Blockchain exists as a shared and public database. This then means that there is no centralised version for a hacker to corrupt and, because it is hosted by millions of computers simultaneously, its data is accessible to anyone on the internet.

Should Wealth Management hop on the Blockchain train?  

Blockchain’s ability to be incorruptible means that data privacy protection, risk and finance history could become less costly and much simpler. For example, smart contracts and an encrypted single point of truth will increase efficiency in exchanging information and therefore make client interactions more reliable.

In regards to next generation service offerings in Wealth Management, the need for diversification and the importance of asset allocation could be addressed by digital investment portfolios being based on baskets of crypto currencies. Portfolio Management and Client Advisory could be replaced with autonomous financial instruments and automated investment vehicles. This would result in more efficient processes but new technologies may also threaten additional sources of income.

Technology Futurist, Ian Khan, states “Blockchain truly is a mechanism to bring everyone to the highest degree of accountability… guarantee the validity of a transaction by recording it not only on a main register but a connected distributed system of registers, all of which are connected through a secure validation mechanism.”

If you want to know more about what Blockchain can offer the Wealth Management sector, visit the only event so far that focuses on the integration of digital capabilities with existing processes, Digital Integration in Wealth Management.


Arena’s business-to-business events offer a myriad of opportunities for sponsors and exhibitors to drive their businesses forward.
Our sponsorship packages help companies educate ther target market on key industry issues and spread brand awareness throughout the

If you want to discuss how we can help you generate leads and add-value to your corporate and brand image please contact:

Paul Adams
+44 (0)20 7936 6948

Speaker opportunities

We identify and invite individuals we believe to be the best speakers in the market, if you think you can make a difference to the quality of our events please contact:

Chloe Roberts
E: Chloe.Roberts@arena-international.com
T: +44 (0)207 936 6822