The integration of blockchain into traditional financial systems is expanding rapidly. Major institutions such as Citi, JPMorgan and Mastercard are making substantial investments, signaling a potential transformation in finance.

Ian Horne, head of content at Money20/20, shared his views on the ongoing shift ahead of the Benzinga Future of Digital Assets event on Nov. 19, where he will speak.

Blockchain’s Growing Role

Horne noted blockchain is becoming deeply embedded in finance, affecting everything from payments to asset ownership. “It’s hard to say otherwise when blockchain is weaving its way into payments and asset ownership,” he explained.

He cited Mastercard’s crypto card programs and PayPal, Revolut and Stripe‘s efforts to launch or expand stablecoin services as evidence of blockchain’s growing role in payments. Central banks are also moving forward with digital currencies, including several central bank digital currency (CBDC) initiatives.

Impact on Payments and Assets

Blockchain’s integration into payments aims to make cross-border transactions more efficient and less costly. Horne mentioned this is especially relevant for transactions involving multiple banks and varying operating hours. Additionally, asset tokenization — transforming real-world assets into digital tokens on a blockchain — could simplify ownership exchange.

“Estimates vary, but it’s generally accepted that many trillions of dollars worth of ‘real world’ assets will likely have their ownership brought to blockchain,” he said. Tokenization not only facilitates faster transactions but also allows fractional ownership, making it possible to invest in smaller portions of assets like real estate or wine.

Challenges to Integration

Despite the potential benefits, Horne identified challenges in aligning blockchain with established financial infrastructure. These include managing numerous blockchains, regulatory approval and the existing legacy systems that traditional finance relies on. “The challenges are many,” Horne noted, adding that true integration will require compromise from both sides.

Horne expressed optimism about blockchain’s role in enhancing transaction privacy and security, potentially reducing data breaches and identity fraud. As technology becomes more prevalent, it could reshape finance by creating more accessible and secure systems.