A new report from consulting and technology services firm Capgemini advises financial services firms that they can no longer “afford to ignore” blockchain technology.

Released on 13th November, the paper argues that the blockchain and distributed ledgers have the potential to broadly impact traditional financial services providers. It proceeds to outline steps affected institutions can take to evaluate various platforms and players currently available.

Overall, the report argues that traditional financial providers will look to the technology as a way to reduce costs related to data management in the short term and make existing processes “more efficient, transparent and inexpensive”.

The report reads:

“Blockchain changes the IT paradigm for processing and has the potential to create a very different model for managing transaction-processing contracts. It also enables all processing to be done over a distributed systems network or in the cloud, avoiding the use of costly data centers and mainframes.”

Included is Capgemini’s nine-step approach to evaluating blockchain technology providers, which encourages institutions to analyze factors including security, decentralization, privacy, scalability, usability, extensibility, cost, operational impact and community support.

In addition to highlighting the bitcoin blockchain, other platforms mentioned as part of the report include BitShares, Counterparty, Ethereum, Factom and Ripple.

The report further highlights the differences between permissionless blockchains – those that do not restrict participants from transaction verification – and permissioned alternatives that allow for more control over who participates in the creation and procurement of a shared ledger.

Capgemini’s latest release comes amidst an uptick in research reports seeking to appeal to enterprise financial services providers and aimed at assessing blockchain technology. In recent weeks, similarly positive reports have been published by firms such as Tabb Group and GreySpark Partners.

Image via Capgemini