As blockchain is becoming a corporate buzzword, there is a real risk of forgetting what the revolutionary idea is actually about. No, it is not about a database or IT modernization – as most banks have single-mindedly set out to frame it. Blockchain as a distributed ledger or irrefutable record has very little innovation in it. The hash function is at least decades old (Ron Rivest’s MD5 came in 1992), append-only functions existed in databases for over 30 years and handling shared, replicated data has been solved in the last century. All modern business databases handle multi-version concurrency. Agreeing on centralized consensus rules are as old as counter-parties, authenticated access control? please… And those are the main elements that many business blockchain projects seem to be after. Nothing new there and certainly no orders of magnitude in cost and speed improvements.
Now Bitcoin did introduce revolutionary ideas in the areas of proof of work (skin in the game) based consensus, security incentives for systematic anti-fraud measures, decentralized validation of value-tokens and they do remain breakthroughs. Very few banking blockchain projects implement these.