The Future Of Finance: This Bank Uses Blockchain And (Much) More To Stay Ahead

Liam Berry
The Future Of Finance: This Bank Uses Blockchain And (Much) More To Stay Ahead
Sponsored by, Northern Trust

Over the past few years, cryptocurrencies have gone from a hopeless meme to an emerging trend drawing reactions from markets and governments around the world. But while most business behemoths have kept crypto-related tech at arm’s length, that doesn’t mean they aren’t willing to learn from some of the technologies that are associated—though not interconnected—with it.

One such innovative firm is Northern Trust. The global financial institution has recently employed the blockchain technology used by cryptos and launched the first-ever blockchain-based ledger for private equity. What, exactly, is that? It’s a cutting-edge software tool that shifts the method of recording and verifying financial transactions, particularly complex ones, in ways that can save time and money.

To better understand Northern Trust’s culture of innovation, we spoke to Arijit Das, IT Developer and Blockchain technology expert at the company.

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What Is The Blockchain? 

If you’re interested in finance, tech, or business, you’ve probably heard about blockchain before. A blockchain is a shared record, in which all data kept is universally standardized and unchangeable (without leaving a trail, at least) for the participants. This decentralized method of data storage is, theoretically, unhackable, because there’s no single server or unit to breach and tamper with. (Hence the “chain.”)  A completely separate technology from cryptocurrency, blockchain technology is a tool that forward-thinking Fin-Tech firms are increasingly finding new and innovative uses for.

“The way we see blockchain benefitting us right now, is more along its functions as a distributed ledger technology,” Arijit says. “It benefits the business by sharing data in a trusted manner between the different parties.”

The most interesting aspect of this tech, Arijit stresses, is that it tells you which data you can trust. This alone puts Northern Trust in the lead when it comes to security. But there are other substantial business benefits as well.

As Arijit explains, ledgers have always been an essential but very complicated aspect of the banking business. Both investors and firms need to have a clear record of who took what from whom, and both parties have fallen victim to error and dishonesty in the past. Even with the advent of digital record-keeping and the internet, ledgers have been difficult to keep both secure and consistent among all parties.

In the past, parties involved in transactions were forced to rely on outside partners like government agencies or contractors to verify information. This process, however, was expensive and slow. Blockchain eliminates this necessity, enabling Northern Trust to be a much nimbler partner for its clients.

That’s why, even in an industry where the game has been changed quite a few times, blockchain stands out as such a game-changer: It automates processes that people couldn’t previously trust programming to handle.

How To Deal With The Data Deluge

Given the obsession we as a society have with data and its collection, it might be surprising to learn that one of the biggest problems with big data is that we don’t know what to do with it.

“Ninety percent of the world’s data was created in the last two years,” Arijit says. “And only about 0.5 percent of that data is actually used.”

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And thanks to things like the growing network of smart devices, satellites, and applications, the amount of data will only continue to expand.

“It’s very dangerous to have data [that] has dubious sources. We all know what happens when things like that occur,” Arijit says. “As data proliferates all over the world, it’s essential that we have some means of tracking problems and tracking where it originates from and whether it’s trusted. And blockchain provides you with a technology to be able to do that.”

The Future Of Banking: Robotics, AI, And The Blockchain “Ecosystem”

There’s more than just blockchain tech being developed at Northern Trust. “We’re also very active in leveraging things like robotics and artificial intelligence,” Arijit says. “We have several programs going on where we’re looking at utilizing AI to predict certain data or certain patterns.”

According to Arijit, AI can have a profound impact on the banking industry, where being the first to analyze minute shifts in data can mean either capitalizing on big opportunities or protecting yourself against losses.

“We’re also using some of the new big data techniques. We’ve got specialist big data tools from Silicon Valley startups. We’ve got big data processing facilities and technologies,” Arijit says.

On top of all that, they also have a new UX design lab dedicated to maximizing the ease and effectiveness of the user experience.

It’s this unique mix of creative, technical, and financial experts that makes Northern Trust an extremely versatile company—both as a business and as an employer. And it’s this innovative culture that enables Northern Trust’s employees to find and create new roles for themselves, all without ever leaving the company.

If you’re interested in working at the corner of finance and innovation, then check out open positions at Northern Trust—they’re hiring on WayUp now!