[Deloitte](http://www2.deloitte.com/us/en.html), one of the world’s “Big Four” audit firms, has announced that they are trialling blockchain tech for potential applications, including the automation of client auditing and crowdsourcing its consulting efforts.
Another day, another mainstream firm, Deloitte, has expressed interest in blockchain technology. The firm joins more than half a dozen major financial or professional institutions in their ambitions to explore distributed ledger technology. One of the major banking institutions, Citi, has apparently been researching the area for three years.
Deloitte Consulting principal Eric Piscini explained in a press that the company has been exploring potential business opportunities around blockchain technology for about eighteen months.
The company stated that it has created an internal group of about 100 staff members, in 12 countries, focused on exploring the potentials of the technology for their banking and retail clients, while also coordinating between these entities and industry startups. It’s named the Deloitte Cryptocurrency Community (DCC).
The DCC has three mandates:
- Educate Deloitte and its clients on opportunities in the space.
- Investigate how the technology could improve existing services.
- Explore future solutions built on the blockchain.
Deloitte has previously released written reports on related subjects, including the viability of a central bank-owned cryptocurrency, bitcoin’s use as a money exchange protocol, and a way to manage staff payments.
Rubix by Deloitte
Deloitte has now released their first software platform, Rubix, that allows applications to be built on top of blockchain infrastructure.
“Rubix is a software platform that allows Deloitte teams and clients to build their own customized blockchain and smart contract applications for any use case.”
— – Rubix Team
Driven from the company’s Toronto office, Rubix is initially being pitched at four application areas:
- Reconciliation – Automate financial reconciliations between internal departments in a company or with trading partners.
- Audit – Get real time assurance on components of financial statements, and lessen the reliance on an auditor.
- Land Registry – Digitize and decentralize a jurisdiction’s property deed transfers, while eliminating the possibility of corruption.
- Loyalty Points – Create a loyalty points program that is more cost efficient and allows for added features and insights for customers.
Deloitte clients can use the platform for all sorts of applications, while internally the company is focused on automating some of its auditing processing via a solution currently in stealth mode.
Bitcoins alternative blockchain dilemma
Many of Deloitte’s clients are currently learning about the technology, trying to determine the differences between Bitcoin, various platforms building on top of it, and alternative blockchains. They also have different needs and want to apply the blockchain to specific use cases, either by optimizing existing infrastructure to cut costs or to increase profits by adding new revenue streams.
While some customers are investigating the use of different platforms like Factom, Counterparty, and Blockstream, which are building on top of the Bitcoin blockchain, a common question is whether to partner with these existing solutions or build a private blockchain. Solutions provided by Ethereum, Ripple Labs, and Eris Industries, all attempt to offer the advantages found in Bitcoin, but without using the Bitcoin network.
By using solutions such as Factom these companies would have an abstraction layer between themselves and the blockchain. They don’t have to say they are using Bitcoin while they get the technology in the backend, the supportive community, and the massive mining network. For others this dissociation does not go far enough. Eris or Ethereum, which use a completely different technology stack, attempt to provide many of the benefits found in the Bitcoin protocol in a disseminated fashion.
Deloitte, on the other end, has an open attitude to this dilemma. For their own applications the company is willing to select the best suited blockchain for each specific use. For its clients, Deloitte acts as a mediator between startups and enterprise companies, as these two communities have not yet developed steady and clear communications.
Many of these startups are conducting their first ventures, without much experience, and don’t know how to talk business with larger firms. Without the right technical and financial terminology from both sides, understanding the issues and potential solutions can be challenging.
Many firms, particularly in traditional finance, have jumped aboard the Bitcoin bandwagon using the term “blockchain” as a buzzword, while divorcing it from the network. The aim is often to create an image of a tech-savvy and forward thinking company.
MasterCard Send is a recent example of a personal payments platform marketed with terms such as "peer-to-peer mobile payments" and “reaches the unbanked”. Expressions like P2P and unbanked are widely used in the bitcoin world and, in this case, they seem to be used to attract attention, making the product look more innovative than it actually is.
Other companies are attempting to apply blockchain technology to whatever they can think of. The range and number of alternative digital currencies has exploded over the past few years. These companies tend to look at the blockchain as the ultimate solution to all problems, not bothering to explore the issue they’re trying to solve, or assessing whether the blockchain provides anything relevant.
Deloitte is tackling the job of making sure companies connect with the best solution providers for each use. Here is where the DCC staff, providing ad hoc advice, could improve communications and collaboration between larger firms and startups, while helping to determine if blockchain tech should or shouldn’t be applied.
Rubix is the test bed for these applications, a strategic platform that sets Deloitte apart from the competition. It could allow startups, as well as their larger counterparts, to quickly implement and evaluate low-cost blockchain solutions effectively, making it easy to pinpoint the best choice with a high degree of certainty.
It’s amazing to see how many major, established financial and consulting firms are diving into the blockchain and cryptocurrency sea of opportunities, some deeper than others. We should also recognize that this technology is here to stay, in which form is impossible to predict.