What would it be like if every Credit Default Swap (CDS, an insurance that can be purchased to insure agains bond default) transaction could be instantaneouly seen by the entire network of traders in the instrument? For one, it would improve the tracking and transparency of the entire operation, and prevent trades from going “missing”. What if it were to substantially decrease the cost per trade, with the savings being passed down to the consumer/ investor? A test of the Blockchain technology in the trillion dollar market of credit default swaps has shown promising results. If implemented, it could greatly reduce the cost of tranactions amongst financial institutions.
Whatever the future of Bitcoin, the leading digital currency, the basic underlying Blockchain technology which facilitates keeping a public ledger of complex transactions over a network, has the potential to transform many maketplaces that still use very tradtional methods of tracking transactions, such as real estate.