Nasdaq is now rolling out an implementation of a Bitcoin trading technology called the blockchain, which is a public ledger of transactions that have occurred on the Bitcoin network. A blockchain is generated by independently owned computers from all over the world that work together to verify that the trades that took place on the network are legitimate. The main difference, however, is that Nasdaq will be using a blockchain style ledger to log the trades of private companies instead. Nasdaq already has 75 private companies signed up for the pilot program, and will begin the project in Nasdaq Private Market—a marketplace started at the beginning of 2014 to handle the trading of private companies in the pre-IPO stage. Forward thinking pioneers are seeing the the blockchain as a way to finally achieve the security industry's goal of real-time settlement, moving away from the sluggish 3-day clearing time that's now happening to a world where the trades are literally cleared in minutes, or even in real time, which should dramatically cut clearing costs and free up capital. If this so-called pilot project works out as planned, Nasdaq wants to migrate blockchain technology into its public stock market—one of the world's largest. This will completely eliminate the legacy systems and clearing processes that have been the backbone of financial asset trading for many decades. So what started as an arcane technology used in the often criticized world of bitcoin trading may just end up dramatically transforming how mainstream financial markets verify and clear trades for the next century and beyond.
Interesting. I wonder what will be used to secure the Nasdaq blockchain; ie Bitcoin has a massive distributed hashing network. Or would this use the actual Bitcoin blockchain? Also maybe there will be less busted trades with a public ledger written in a blockchain which may be more difficult to alter (definitely is for Bitcoin).