Blockchain technology has the ability to disrupt the financial world, so why aren’t more private equity firms using it?
This was the key question posed by Real Deals in a recent article examining the utilisation of blockchain within the private equity sector. Featuring insights from a range of senior professionals from across the private equity and technology spheres, the article discusses the merits and risks of blockchain technology, current roadblocks, recent developments in this space and its potential for the future.
Among the digital assets experts consulted were IQ-EQ's Group Chief Information Officer, Chris Robinson, and funds director Peter Soesbeek. Together, they highlighted the confusion among GPs and LPs over what blockchain actually is and thus the advantages it has to offer – such as its potential as an efficient and secure alternative to a classic server or cloud-based platform.
They also discussed the fact that blockchain is still a relatively young technology, which needs greater standardisation and concrete examples of how it works in order to make firms more comfortable with it. That being said, Covid-19 has pushed the private equity sector towards a greater reliance on technology – which could, in turn, boost the rate of blockchain adoption. Indeed, as Peter pointed out, there's been "a flood of money going into blockchain backend projects within corporates and we ourselves have done a lot more over the last 12 months in this space as part of a wider digitisation."