Standard & Poor's could consider making rating changes of major financial institutions if the use blockchain technology becomes widespread and starts to impact current business models, the global ratings agency said.
In a report published Wednesday, S&P said that it believed the rising investment in blockchain technology suggested that a "transformation" of the financial industry could be underway.
Blockchain works like a huge, decentralized ledger for the digital currency bitcoin, recording every transaction and storing this information on a global network so it cannot be tampered with. It's this technology that banks feel can be used in areas from remittances to securities exchanges in order to slash costs and create a fraud-proof record of transactions without the need for third-party authorization.
S&P said the technology could streamline back-office operations, shorten clearing and settlement times, facilitated payments and generate new revenue streams for financial institutions from banks to asset managers.