Nasdaq will start using the bitcoin’s “blockchain” technology to streamline transactions on the stock market, Financial Times reported.
Blockchain, which powers the bitcoin virtual currency, validate trades based on an algorithm that runs on third party computers, removing the need for banks, clearing houses or other intermediaries.
Now, Nasdaq plans to adopt the technology across its markets.
The first application, due later this year, will handle the issuance and transfer of stocks on the Nasdaq Private Market platform, which manages transactions in private stocks, the report said.
The technology will “modernize, streamline and secure typically cumbersome administrative functions,” Nasdaq CEO Bob Greifeld was quoted as saying.
As a public, distributed ledger, the blockchain currently acts as a central repository for details of all bitcoin trades, though it could also be used for other financial assets.
“Utilizing the blockchain is a natural digital evolution for managing physical securities,” Greifeld said, according to the Wall Street Journal.
The technology holds the potential to “benefit not only our clients, but the broader global capital markets,” he said.
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