Blockchain Integration in Finance Faces Challenges: Need for Standards and Regulatory Clarity Highlighted by GBBC CEO

Blockchain adoption faces some real challenges when it comes to integrating with traditional finance systems. It’s clear that we need uniform standards and regulatory clarity for blockchain to grow in financial institutions.

As more traditional financial entities start using blockchain, they encounter both opportunities and obstacles. It’s a balancing act.

Sandra Ro, the CEO of the Global Blockchain Business Council (GBBC), recently shared her insights on these challenges. She emphasized the essential groundwork required for blockchain to advance in finance. You can catch her discussing these topics at the upcoming Benzinga Future of Digital Assets event.

Ro pointed out that many financial firms are busy creating tokenized products, like money market funds and bonds. They’re also working hard to connect blockchain systems with traditional financial structures. “Institutions are leaning into developing tokenized products like money market funds, bonds, and repo,” she said. This effort aims to ensure that blockchain technologies can work alongside conventional infrastructure, allowing these tools to function across various financial platforms.

At the recent SIBOS conference, Ro highlighted the need for uniform standards. Groups like Swift, the Depository Trust & Clearing Corporation (DTCC), Deutsche Börse, and Euroclear are collaborating to create frameworks that support blockchain development.

In Ro’s view, a critical step for these systems to reach their full potential is tackling what she calls “the digital cash leg” of tokenized transactions. Addressing this part of the system is vital for technology to deliver its complete value to the financial industry.

She also pointed out that regulatory uncertainty is a significant hurdle. “Much work is in progress by the industry to scale, but regulatory uncertainty hinders scaling and innovation,” she noted.

Ro mentioned ongoing initiatives, like the Digital Asset Market Subcommittee (DAMS) under GMAC. This group aims to develop consistent definitions for digital assets. This work could help reduce regulatory confusion and provide a clearer path for future industry progress.

As blockchain continues to make its way into finance, Ro’s comments show that achieving technical interoperability and regulatory clarity will be crucial for the industry’s future. The upcoming Benzinga Future of Digital Assets event will bring experts together to discuss these foundational topics in more detail.

As the digital asset market matures, the intersection of regulatory changes, mergers and acquisitions, and adoption trends will shape the future of this dynamic field. The Benzinga Future of Digital Assets event in New York City this November will offer industry leaders and investors a platform to explore these developments further. Attendees can expect insights into the evolving regulatory environment and the latest market dynamics.