JP Morgan has listed three companies it believes are ideally positioned to deliver blockchain-as-a-service (BaaS) to potential investors.
Full Faith in the Technology
The Wall Street bank is one financial institution that is embracing the blockchain.
Through its Interbank Information Network (IIN), JP Morgan is aiming to streamline the firm’s global payments process by reducing delays. In September, it was reported that the bank had attracted 76 banks to join its blockchain-based financial application.
Now, in its continued enthusiasm for the technology, it has listed three companies it believes will deliver blockchain-as-a-service to potential investors, reports CNBC.
In a note to clients, Sterling Auty, JP Morgan software equity research analyst, said:
Investors should be looking to identify where the opportunity to replace a middleman is the biggest, or where trust is needed where none exists, or what companies are the best positioned to offer blockchain as a service.
Notably, the three public companies are Akamai, a cloud service provider, DocuSign, which provides electronic signature technology, and Ellie Mae, a software company that processes mortgage applications.
According to JP Morgan, Akamai has an “overweight” rating that has the potential for a BaaS solution.
While there are a number of companies that have blockchain technology, IBM as one example, we believe the sizeable Akamai network is an inherent advantage in running a distributed ledger in blockchain.
DocuSign was also rated as “overweight.” It was noted for its ability to leverage both private and public blockchains. Auty noted that the platform could shift from a centralized security model to a decentralized one. Regarding Ellie Mae, JP Morgan rated this as “underweight.” In Auty’s opinion, real estate is the most “obvious” use case for the technology.
Utilizing blockchain to manage the entire mortgage process could bring trust among parties and use of smart contracts could help automate various tasks (inspection, income/employment verification).
These companies certainly have the potential to deliver. Not only that, but they are well-known too, which will certainly help if they decide to embrace the blockchain. However, it remains to be seen whether they will utilize the technology to bring about a change while also providing exposure to investors in the long-term.
Yet, the fact that JP Morgan has highlighted which companies have the ability to create disruption should give them something to think about.
What do you think? Do you think these companies will be winners in the long-term? Let us know in the comments below.
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