Nasdaq, n.d.
Nasdaq, so called National Association of Securities Dealers Automated Quotations, announced a collaboration with SEB group which seeks applications of blockchain technology on mutual fund market (Aitken, R., September 2017). The project undergoes with a goal to use blockchain to establish a more reliable and efficient exchange system.
As the world’s first electronic stock-exchange, Nasdaq is also the first exchange that enabled customers to trade cryptocurrency. More recently, Nasdaq opened Ethereum for European investors. These steps allows Nasdaq to pronounce its value proposition within action:”Develop efficient and reliable technologies that orchestrate and facilitate capital markets activity”(Nasdaq, n.d.). Furthermore, with the collaboration with SEB, it is clear that Nasdaq embraces futuristic blockchain technology as tech-giants including Alibaba and Microsoft, rather than rejecting like JP Morgan.
Ransbotham, S., April 2016
This business strategy of Nasdaq has differentiated itself from other exchanges, which positions Nasdaq as one of the pioneers in adapting blockchain in real application. Since mutual fund contains various sophisticated procedures and complex ledgers, the characteristics of blockchain allows both investors and mutual fund managers to track and proceed transaction in a simpler manner with higher precision. Thus, once the project successes, Nasdaq is able to expand it’s market share greatly with the continuously growing popularity of blockchain.
Risks and challenges are considerable heavy for this “joint project”(Aitken, R., September 2017), of course, just like Ethereum is facing an upcoming hard fork with a discovery of a “consensus bug” (O’Leary, R. R., Octobor 2017). Similar fork is also occurring for Bitcoin in November, which demonstrates a critical weakness of adopting blockchain applications, that once a technical mistake is observed, the renewal of system often requires complete updating software: resulting as a hard fork. Therefore, the real reliability and effectiveness of this collaboration still lays in question since the rick and financial cost of development may outweigh the product, until a more thorough solution can be discovered for blockchain’s software update.
After-all, Nasdaq conveys its value to investors and customers deliberately through such business decision, which allows results as a beneficial marketing outcome. Hence, to conclude, Nasdaq successfully represents its point of differentiation that reveals its value proposition through business activities, which many companies still lack.
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Reference
Aitken, R. (2017, September 27). NASDAQ Collaborates In SEB’s Blockchain Investment For Mutual Funds Market. Retrieved October 14, 2017, from https://www.forbes.com/sites/rogeraitken/2017/09/27/nasdaq-collaborates-in-sebs-blockchain-investment-for-mutual-funds-market/#4ef418c3696b
Ransbotham, S. (2016, April 26). [As a technology enabling greater data transparency, the opportunities blockchain offers are immense.]. Retrieved October 14, 2017, from http://sloanreview.mit.edu/article/blockchain-data-storage-may-soon-change-your-business-model/
Nasdaq. (n.d.). [L1_Pillar_headline]. Retrieved October 15, 2017, from http://business.nasdaq.com/list
Nasdaq. (n.d.). Nasdaq’s Story. Retrieved October 14, 2017, from http://business.nasdaq.com/discover/nasdaq-story/powerful-model
O’Leary, R. R. (2017, October 14). Ethereum Developers Find Geth Bug as Hard Fork Nears. Retrieved October 15, 2017, from https://www.coindesk.com/ethereums-geth-client-finds-vulnerability-less-two-days-before-fork/