The inexorable march of the blockchain, the digital transformation transformation technology that is making its way through the global financial landscape, is a distinct threat to consultant revenue streams.
Over the next few years, blockchain will allow today's customers to execute transactions for securities and financial products on their own, causing many advisory fees to be exhausted.
As an earthquake triggering a tsunami, the do-it-yourself transactional environment that the blockchain is already driving will result from continued advances in consumer products and services that use artificial intelligence. Futuristic scenarios that until recently were considered distant decades – such as those in the film "Blade Runner 2049", in which Ryan Gosling's character easily performs complex research tasks simply by talking to his home computer – are now evident, like the people ask Alexa to find websites, order pizza and play their favorite songs. For the Blade Runner scenario, forget 2049. Instead, try 2029 or maybe sooner.
The concomitant development of blockchain technology and the proliferation of blockchain for a myriad of purposes will allow access to data and transactions by consumers, at will, just by talking and listening.
The implications for the survival of the consultants are clear: they have to focus on real consulting clients, drawing on human qualities that machines can not replicate (yet) – balance, perspective, empathy and goal-based analysis.
But to rework their practices accordingly – and in order to adapt to the next blockchain environment – consultants must gain a clear understanding of how the world of transactions will change, how it will be in five or ten years, and the future expectations of customer service tomorrow. It is also essential to understand how this transformation will interrupt the mechanisms of the global economic system.
Current or planned scenarios that reflect reality or signal the short-term palpability of this new environment include:
• Tokenization: the conversion of rights into a resource in units, represented by tokens. The transparent audit trail of Blockchain allows secure registration of property tokens, representing a percentage of almost all assets: real estate, antiquities, a sports league or a company, in equities. Already, people sell actions that document the mutual ownership of real estate and store it on blockchain so that everyone can see them: a sort of global stock register. Some are even of tokenizing art works.
In the end, many, if not all, the securities will be tokenized and regulatory approvals for this are already happening: Delaware, the Mecca of company cards, modified the bylaws to allow the use of the blockchain for the registration of corporate shares . In addition, the SEC will likely lend its blessing because of the blockchain-resistant immutability of hackers, a feature that is beginning to conquer exchanges, as it ensures superior security and promotes monitoring.
If your client wants to sell a portion of the digitized equity shares alone through a decentralized blockchain-enabled exchange and then use this money to buy a piece of Picasso that is tokenised, all without the use of an intermediary that charges fees brokerage or commissions. However, the client may want advice if the transaction makes sense from a tax or investment perspective. Consultants who are unable to accelerate blockchain transactions – or the fine arts, other than that, may have difficulty gaining or retaining client advisory services. This example shows that the skills of the consultants who survive the blockchain revolution will have to expand or extend to partnerships with newly developed specialized firms to advise customers with different predilections to own tokens for all types of resources (including those that are now called digital objects). .