Warsaw-based bank Alior has announced that it will be using the public Ethereum blockchain to verify official documents. Alior is only the second bank in the world to use Ethereum’s public blockchain, after investment bank Societe Generale issued a $112M bond on the network in April.
A major Polish bank is hopping on board the Ethereum train. Alior plans to leverage Ethereum’s blockchain to comply with new guidelines set by the country’s Office of Competition and Consumer Protection. Alior believes that, if successful, its efforts could become a model for other banks in Poland.
According to the government regulatory body, a page which can be changed easily can’t qualify as a “durable medium.” Therefore, Polish banks now need to strengthen their authentication systems. Rather than create a new system from scratch, Alior had a different solution: why not just use Ethereum? Not only does using an existing blockchain-based network save costs, but it prevents information tampering entirely.
Ethereum to the Rescue
According to the bank’s blockchain strategy lead Tomasz Sienicki, “we are showing that it’s possible to use blockchain even if some people think it’s impossible.” Most banks thus far have opted for their own, private blockchains, if they use the emerging technology at all. Alior, however, found this to be insufficient. A private blockchain, by definition, can’t allow for others to see if everything is being verified correctly. “We want people to verify that we did everything right and we don’t conceal anything,” Sienicki said. That’s exactly why the bank is using the Ethereum public blockchain.
How it all works is quite simple. Each document will be related to a specific document with a given hash number. If the hash stored on the blockchain is identical to the hash calculated from the document, it is verified. This way, Alior can prove that its documents have not been tampered with.
Alior has not specified how soon we can expect the bank to implement the idea. However, by all estimates, it should be soon. Alior already has a division entirely dedicated to blockchain.
Do you believe we can expect to see more banks leverage Ethereum to verify documents? Let us know your thoughts below.