Cantor Fitzgerald analyst Joseph Foresi attended this week’s Consensus 2018 blockchain conference in New York and released a note on Wednesday discussing the investment implications of blockchain.
Foresi said blockchain technology is still in its embryonic phase, with few limited functional applications. However, he said there are many promising ideas, particularly in financial services. A recent Deloitte survey found that 43 percent of companies are calling blockchain a top five strategic opportunity.
At the same time, Foresi said the cryptocurrency hype associated with the Consensus conference was bigger than ever this year, with attendance tripling to 8,500. Still, with more than 1,900 cryptocurrencies out there, Foresi says the future of crypto remains up in the air.
“It remains undetermined whether crypto is reliable, can hold value, and how credible the promises are for future issues,” he said.
Foresi said cryptocurrencies must compete with the U.S. dollar and face an uncertain regulatory future.
From an investing standpoint, Foresi said IT Services stocks such as IBM (NYSE: IBM), Accenture Plc (NYSE: ACN) and Cognizant Technology Solutions Corp (NASDAQ: CTSH) could benefit from a rise in blockchain projects.
Foresi said merchant acquirers and payment processors could potentially have their business disrupted by blockchain tech in the long-term. These stocks include Global Payments Inc (NYSE: GPN), First Data Corp (NYSE: FDC), Paypal Holdings Inc (NASDAQ: PYPL) and Square Inc (NYSE: SQ).
Foresi also said core bank processing and accounting could also be impacted by blockchain technology, but he doesn’t see any material threat to those businesses at this time.
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