Invoking the virtue of creative destruction can be an empty cliché or a rhetorical misdirection. When it comes to blockchain technology, however, the phrase would appear to be most appropriate. As noted in this space before, blockchains can be powerfully deployed in the area of supply chain management. But a host of other applications are on offer. Among the many transformations that the technology presages, perhaps none is as potentially powerful as the prospect that it will reduce friction in financial markets.

Financial institutions were among the first wave of commercial businesses to explore how blockchain technology can be applied to different aspects of financial markets, including syndicated lending, payment systems, and administration of capital markets. This might prove especially salient in the realm of fundraising through, for example, token offerings or clearance and settlement systems. Leaders in finance also believe that blockchain technology can help make traditional infrastructure more efficient, promising significant advantages.

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