The CEOs of two companies, which have been experimenting with the method of blockchain have commented that the reality of the technology is yet to justify its hype. These two companies are namely, Mastercard and Wells Fargo. Speaking to Andrew Ross Sorkin at CNBC on Wednesday at the Festival of Fintech Ideas, the CEOs of both companies confirmed to have recognized a long-term potential in blockchain, but that its use-case in business is still ambiguous.
Tim Sloan, who is the CEO of Wells Fargo, called blockchain to be “way oversold” while addressing the crowd at San Francisco’s conference on-stage. He also expressed his appreciation for the fundamentals of the technology and criticized the slow roll-out of blockchain. In particular, Sloan gave the example of a project in which the bank of U.S. collaborated with Australia’s Commonwealth Bank. They used blockchain in trade transactions. Sloan added that such blockchain pilots and consortiums are yet to garner real adoption. In fact, the pilot in Australia only effected one transaction.
Blockchain, also termed as distributed ledger, is essentially an unalterable database which can be viewed by each and every participant using it. Be it tracking lettuce from a chain of supply or the storage of health records, it has a lot of potential use cases. Further, this technology underpins bitcoins and other such cryptocurrencies.
Speaking in the same strain is the CEO of Mastercard, Ajaypal Banga who also harbors reservations regarding the technology. Interestingly, Mastercard currently ranks third on the list of companies with maximum blockchain patents. Banga agreed with Sloan on-stage and commented that blockchain has the potential of being interesting but its business model still requires proof. He added that huge improvements and changes are required over time. Banga also pointed out the deep investment that Mastercard has in certain blockchain ideas. Blockchains can potentially make supply chains better and solve the problem of counterfeit goods.