NEW YORK (TheStreet) -- What can you do with the blockchain, a public account of every Bitcoin transaction ever? No one knows for sure, but big banks like UBS (UBS) - Get Report , Barclays (BCS) - Get Report , and, Citi (C) - Get Report are betting that it may reshape the future of finance.

Bitcoin, once the darling of the dark Web, has recaptured imaginations for its underlying technology, the blockchain. Heralded as the "internet of finance," the blockchain has bewitched bankers for its potential to streamline settlements and reduce transaction costs.

The blockchain has many possible applications, like expediting stock trades, cutting fees on money transfers, and making payment systems more efficient. But no one knows which will have the greatest impact.

What is certain is that this fundamental change in the ability to move value -- money, assets, shares, deeds -- has seized new attention. And in a rapid about-face, bankers are asking not if the blockchain will affect their business, but when and how.

What Is Blockchain?

At its heart, the blockchain is a seemingly dull database used to record and update transactions. Databases aren't new; companies like PayPal (PYPL) - Get Report and Visa (V) - Get Report use similar bookkeeping systems to manage accounts. The difference is that the blockchain is run on a decentralized network, where accounting is distributed instead of managed by a third party. Everyone using the network can see all of the transactions in real time on something akin to a globally shared spreadsheet.

Transactions on the blockchain are also irreversible, meaning that once a record has been confirmed, it cannot be manipulated. This confirmation confers trust in the distributed network -- a problem that previously could only be solved by an external party, like a bank or clearing house.

The Blockchain Bandwagon

Nasdaq OMX GroupI:IXIC was one of the first to trial blockchain technology for its private market stocks. The current system, which uses paper certificates, will be updated with bitcoin-based blockchain technology to execute faster and more transparent exchanges.

UBS, another early mover, launched a blockchain research and development lab last spring inside one of London's booming financial-technology accelerators, Level39. UBS's blockchain group focuses on "proofs of concept:" developing hypotheses, testing them out, and seeing what works.

Barclays, which also runs a bitcoin accelerator program, announced Sunday that it will begin helping charities accept bitcoin payments. This makes Barclays the first U.K. bank to accept digital currency.

Citi, long reticent about bitcoin, reported over the summer that it had created its own digital currency, a "Citicoin." Citi revealed that it's tinkering internally with three different blockchain-based distributed ledger systems to explore more efficient ways to transfer value.

BBVA (BBVA) - Get Report and Goldman Sachs (GS) - Get Report have also embraced the blockchain. In July, BBVA reimagined a fully decentralized financial system based on blockchain technology; and in May, Goldman described digital currencies as part of a "megatrend" that will transform the movement of money.

And in June, Santander (SAN) - Get Reportannounced that it's testing 25 different applications for blockchain technology through its financial technology investment fund, InnoVentures. Santander thinks that blockchain technology might save $20 billion annually on international transaction and settlement costs.

Where Blockchain Is Going

It's unclear where the blockchain is headed -- faster trades, settlements, payments, or financial infrastructure. Bankers are increasingly exploring the notion of "permissioned" ledgers. These are private distributed ledger-based systems that extol the benefits of blockchain technology, but retain a higher level of managerial and regulatory oversight.

But what is evident in the upsurge in blockchain interest is an equal boom in bitcoin sector investment: $915 million so far in 2015, up 262.5% since last year.

As the search to discover the blockchain's great fortune accelerates, the race is now on to see who will get there first.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

This article reflects the author’s views only and is not affiliated with any company, organization, or institution.