A recent report published by Citi suggests that bitcoin could challenge or even supplant some traditional payment services if adoption widens in future years.According to Citi GPS, a corporate publication owned by the financial institution, the technology underlying digital currencies has the potential to disrupt current-day payments structures.It cites debit/credit card systems and remittance services in particular, saying: "The essential innovation in bitcoin is that it can eliminate the need for a ‘trusted intermediary’ when the principals in a transaction do not trust each other.There are many such transactions but money transfer/ credit/ debit card transactions stand out."However, the report goes on to state that security risks and price volatility may prevent bitcoin from ever becoming more than a "wannabe means of transactions".The report compares the roughly $6.2bn bitcoin market capitalization with that of the combined global payment companies, which amounts to approximately $300bn.

As many as $15.5tn debit and credit card transactions took place in 2013, and it is this large market that digital currencies are poised to disrupt in the years to come, the report continued.Citi directly cited the potential cost savings of using digital currencies like bitcoin as a payment vehicle.Notably, the report said greater use of bitcoin for this purpose is possible even when accounting for transaction costs collected to boost security in the bitcoin network."Bitcoin transactions have potential cost advantages over conventional payments and reduce the need for intermediation.The gap between conventional transactions cost and any bitcoin fees for convenience and increased security will allow bitcoin to make incursions into this market."The financial institution also suggested that other digital currencies, such as litecoin, dogecoin and blackcoin, in particular, could also gain more market share, calling transactions in those altcoins "significant".Notably, the report suggested that companies that offer credit and debit card services may face increased competition from digital currencies that could disrupt their existing business models.

"If fraud/chargebacks can be reduced or eliminated by digital currencies there is plenty of room for margins to be eroded.Retail transactions across borders could also become very inexpensive, if the charges involved in going from one currency to another were substantively reduced."The impact on foreign exchange (FX) markets is less certain, said Citi, given the low margin that already exists.However, the report said that companies which charge higher fees to transact between currencies, including global remittance firms, "may find their franchise eroded if generic bitcoin technology lowers the cost if these transactions".The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies.Have breaking news or a story tip to send to our journalists?Contact us at [email protected]/* */.

In the next 10 years, 30 percent of banking jobs could be obsolete, according to a recent Citi GPS report.This statistic from Citigroup’s report makes an assessment of the potential impact of fintech on the global banking industry.bitcoin giropayIt echoes the concerns of former Barclays PLC Chief Executive, Antony Jenkins, who referred to the position of consumer banking as being “in an Uber moment” that would lead to rapidly accelerating job losses.bitcoin welche zahlungsmöglichkeiten gibt es“I predict that the number of branches and people employed in the financial services sector may decline by as much as 50 percent over the next 10 years, and even in a less harsh scenario I expect a decline of at least 20 percent,” said Jenkins in a recent speech in London.bitcoin first

The indicators of the disruption lie not only in the decrease of traditional financial services employment opportunities, but in the increase of investment in the disruptors themselves.“In the last four years, venture capital investment in fintech has increased more than 600 percent,” reports David Shrier, managing director of MIT Connection Science and lead instructor of the university’s new online fintech certificate course, Future Commerce.gps65 bitcoinA large chunk of those drawn to fintech are the innovators with novel ideas, or those trying to find inspiration and discover that great idea to get their startup going.bitcoin greg maxwell twitter“With billions of dollars flowing into the industry, they’re set to disrupt the business of major institutions like Goldman Sachs, Morgan Stanley and UBS.bitcoin graph chart

And those big companies are fighting back,” says Shrier.Not Only the Disruptors Benefit from Disruption Many established institutions have, however, woken up to these opportunities and in response are pushing spending on innovation.bitcoin za gryCorporate executives and business leaders tasked with helping management understand what’s going on with disruption in financial technology, or helping larger companies deal with the changing reality of financial innovation and financial technology, are also jumping on the fintech bandwagon.bitcoin gtk clientCitigroup’s report indicated that, “An open question remains as to whether incumbent banks in the U.S.bitcoin gta 5and Europe can embrace innovation, not just talk about blockchain and hackathons, before fintech competitors gain scale and distribution.” A portion of banks have already increased IT spending, first investing heavily in digital banking and currently pouring money into accelerators, alliances and innovation labs, according to a EY report.guestlogix bitcoin

Barclays, for example, is creating a worldwide community for innovation in fintech – a plan of action that has already involved opening an accelerator program in New York’s Silicon Alley.So, what does it all really mean?galt's gulch bitcoinBetween the disruption created by fintech startups and the deluge of fintech-speak around areas like Bitcoin, blockchain, and the relationship between them, there’s a need for well-established institutions to, at least, start by forming a fundamental understanding of what this all means for the future of their businesses.de-gulden bitcoinMIT Offers a Solution for Demystifying the Madness “You need to understand what’s going on in this highly chaotic environment.bitcoin gun salesAnd we can help,” suggests  Shrier, who is set to lecture alongside the likes of MIT’s Alex “Sandy” Pentland, Brian Forde and Joost Bonsen, along with a host of industry leaders.gundlach bitcoin

MIT’s mandate is to advance knowledge in areas that will serve to address the 21st century’s great challenges by educating students in science, technology and other fields of scholarship that will best serve the world.chris guzowski bitcoinTo this end, the university is collaborating with online education company GetSmarter to deliver a 12-week online short course that will equip professionals with an understanding of the future of money, markets, transactions, commerce, security and privacy – with a focus on the disruptive technological innovations that are influencing them.bitcoin g2aThe online learning model used in MIT XL’s courses is underpinned by a predominantly constructivist, action-learning approach to the design of online learning activities.g2play bitcoin

The student is seen as an active participant in creating knowledge in collaboration with peers, and learning activities and assignments focus on engagement rather than instruction.But just because you’re learning online, it no longer means you’re learning alone.matrox g200 bitcoin mining“We are using new team collaboration technology developed in Sandy Pentland’s research group to improve how remote project teams collaborate on a business plan, and new ‘prediction markets’ technology to run a game that harnesses wisdom of crowds to predict future securities prices,” said Shrier.haas bitcoin bot“We’ve had phenomenal interest in the fintech course, even before its maiden presentation, with more than 500 registrations already received,” notes Ryan O’Mahoney, chief marketing officer of GetSmarter, “Seeing students sign up from across the U.S., Canada, Brazil, Hong Kong, Singapore, U.K., Australia and throughout Europe shows the breadth of the interest in this disruptive topic that is threatening long-established industries.” The course offers unparalleled access to thought leaders in fintech while the student undergoes theoretical knowledge development, as well as hands-on experience of innovation in areas such as collaboration tech and prediction markets.haaretz bitcoin