Needless to say, the era where backs avoided the thought of the blockchain like it was some sort of hot potato has come to and end – as now we see banks all over the world erupting with departments solely focused on blockchain technology and how it can be utilised to improve the banking experience.
Private blockchain networks have been developed in banks such as JPMorgan in the US to enable real-time payments between clients within the institution. However, Polish Bank Alior – one of Poland’s 10 largest banks – has branched out of the financial realm of the blockchain. Alior has begun rolling out a new feature that leverages on the ethereum blockchain to allow customers to check on the authentication and integrity of official documents they receive. This is an especially interesting case as Alior stands out as being one of the first – if not the first – in using a public blockchain.
Developed by the bank’s recently established department for blockchain services “Block Centre of Excellence”, this project was as a result of Polish regulations which required banks to provide customers access to documents in the form of a durable medium. In 2017, the Office of Competition and Consumer Protection disqualified pages on the bank’s website due to their vulnerability to alteration.
The platform offered utilises the smart contract feature of the ethereum blockchain to ensure that the integrity of the document record is not compromised.
“We know exactly in which block of ethereum the document with a given hash is published. If we know the block number, we also know the timestamp,” says Piotr Adamczyk, Alior’s blockchain technology lead who was in charge of writing the code for the project. “We know that the document was published some time ago and hasn’t been changed in that time [if the hash stored on the blockchain is identical to the hash calculated from the document], so we can prove it hasn’t been replaced on our servers.”
Furthermore, by using the public ethereum blokchain, Alior is driving to prove that banks and financial institutions can rely on public blockchains for the security of the services that they provide. They want to set an example for other banks to follow, openly encouraging others to reuse the very solution that they have implemented.
“Our mission is to be disruptive, so we want to provide innovative solutions, and we want other banks to follow us as well. We welcome if somebody copied our solution,” says blockchain strategy lead Tomasz Sienicki. “We are showing that it’s possible to use public blockchain even if some people think it’s impossible.”
Alior’s grand step has been instrumental in encouraging a paradigm shift of moving security to the public blockchain. With time, we may see more and more institutions around the globe placing more trust in the public ledger and adopting it as their means of conducting highly secured operations.