Blockchain Technology for Reputation Scoring of Financial Actors
5th edition (2014/2015)
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There is currently no clear method of publicly and transparently displaying the conduct of financial professionals. Individual ‘rogue tra-ders’ might be recognisable through the media, and regulatory directo-ries – such as the Financial Services Register of the Financial Conduct Authority (FCA) – provide some in-formation, but it remains difficult for members of the public to assess the record of any particular professional.
Reputation is highly important within the closed networks of finan-cial sector professionals. Many care about how they appear to their peers and prospective employers. The lack of external public recording of repu-tation markers, however, sets up a dynamic in which financial insiders feel accountable to other insiders, but not to the broader world.
To alter this dynamic, I propose a public reputational scoring system for financial professionals, or finan-cial firms, based on the underlying technology used by the Bitcoin cryp-tocurrency system. Implementing such a system will create a new di-sincentive for financial professionals to engage in unethical practice, and furthermore, could encourage a ran-ge of positive behaviours.