A recent technological innovation called the "blockchain" has the potential to transform the way financial institutions process transactions and corporations conduct business.

Financial institutions and corporations have traditionally relied on written documents exchanged during in-person closings to complete transactions and loans, and relied on written checks to document the transfer of funds. Transactions are also subject to time-intensive, complex, and laborious regulatory and compliance reviews. Now blockchain technology offers corporations and financial institutions the opportunity to eliminate billions of dollars in operating costs from the myriad transactions they engage in every year.

Although blockchain was first introduced as the technology underlying cryptocurrencies, it is now being applied in traditional businesses. For example, a consortium of leading banks—including Morgan Stanley and Credit Suisse—recently partnered to apply the blockchain to streamline cross-border payment settlement, with other banks such as Goldman Sachs and Banco Santander developing their own competing blockchain-based system.