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What is blockchain?

What is blockchain?

Blockchain is a technology that allows us to distribute and synchronise data across different parties, using cryptography (including encryption) to secure the data and ensure any tampering is evident.

This is a type of distributed ledger technology and, in financial services specifically, can be used to decentralise trade processing by enabling simpler direct peer-to-peer transactions.

In this example, traditionally when a trade occurs a record of each transaction is logged by a third party, such as a financial market infrastructure (FMI). This third party also checks the validity of the transaction. However, blockchain is a way of making and keeping a record of a transaction without a centralised third party being required, as all the parties involved can see the record of a transaction, although not necessarily the details of the transaction itself (see also “is blockchain safe?”). This is what is called a “distributed ledger”.

Watch Barclays’ blockchain experts demystifying some of the myths around the technology