In a recent statement, Timur Turlov, who is the head of the investment organization Freedom Holding Corp., stated his skepticism regarding the potential of blockchain technology in the development of new financial products. The topic of whether or not cryptocurrencies could quickly replace traditional money within the banking system was something that he questioned.
Turlov admitted that he does not have a complete understanding of the huge benefits that blockchain technology offers or how it has the potential to alter the world. According to his point of view, the integration of technologies and methods of payment that are both faster and more cost-effective is already taking place even before the broad deployment of blockchain.
Turlov expressed his reservations over the current phase of blockchain application in financial instruments and goods while he was speaking at an international symposium in Astana that was dedicated to the advancement of financial information technology. The additional dangers that are connected to the implementation of blockchain technology were emphasized by him again.
It is possible, for instance, that the development of Central Bank Digital Currencies (CBDCs), which are meant to include the state into the blockchain ecosystem, could result in significant increases in running costs and endanger the general stability of the financial system.
Advantages of Blockchain Technology
Although Turlov has some misgivings about blockchain technology, he acknowledged that it does have the potential to offer some advantages. However, he stated that due to the hazards that were linked with its execution, caution should be exercised. Furthermore, he expressed the hope that his worries would finally be proven to be unfounded.
Nevertheless, he stated that authorities all around the world are currently investigating the dangers that are associated with blockchain technology. After the introduction of CBDCs, there is a possibility that imbalances may be created as a result of competition between central banks and their respective banking systems. This competition should be carefully considered before digital initiatives are implemented.
Before the year 2025 comes to a close, the National Bank of Kazakhstan intends to launch its own digital currency, which will be called the Digital Tenge. The National Bank of China stated in a report that was released in December 2022 that there were no concerns associated with the use of the Digital Tenge in terms of monetary policy, financial stability, and the economy as a whole.
One of the main aspects of blockchain technology is that it is a decentralized mechanism for the storing of data, which organizes the data in chronological order inside an immutable chain. In this way, it is ensured that the data may only be altered with the agreement of all of the individuals who are a part of the business network.
By way of illustration, blockchain technology has the potential to eliminate the requirement for a third party in real estate transactions. This is accomplished by creating a platform that is both transparent and secure for direct transactions between buyers and sellers.
A blockchain solution that was developed in partnership with Freedom Finance Bank and developer BI Group was presented to the public by Kazakhstan’s state-owned business known as “Government for Citizens” in February of 2023.
Through the utilization of this cutting-edge solution, the registration of online transactions for the purchase and sale of secondary housing is made easier.
Through the exploration of Timur Turlov’s perceptive concerns and thought-provoking perspectives, we are able to acquire a more profound and all-encompassing comprehension of the intricate complexities and multifaceted considerations that are associated with the implementation of blockchain technology in the dynamic and ever-evolving financial industry.
It is through the exploration of his nuanced insights that we are able to negotiate the hurdles and grab the opportunities given by this disruptive technology, so opening the road for innovation and advancement.
