LONDON ' Bank of England governor Mark Carney thinks the technology first developed to underpin digital currency bitcoin could "transform" crucial parts of financial infrastructure.Speaking at the Treasury's first International Fintech conference in London on Wednesday, Carney said:"New technologies could transform wholesale payments, clearing and settlement. In particular, distributedledger technology could yield significant gains in the accuracy, efficiency and security of such processes, saving tens of billions of pounds of bank capital and significantly improving the resilience of the system."Distributed ledger technology refers to technology, also known as blockchain, that was developed to underpin bitcoin. The technology is a form of shared ledger that is updated in near real-time across different members of the network.For payments, the clearing of payments, and the settling of transactions such as securities trades, it has the potential to cut out duplications and admin. Rather than working through middle men such as clearing houses and maintaining separate ledgers to monitor trades, banks and other institutions can talk directly to each other and update their shared database at the same time.Santander and Oliver Wyman estimated in 2015 that blockchain could save up to $20 billion in infrastructure spending by 2022.Carney said:"Securities settlement seems particularly ripe for innovation. A typical settlement chain involves manyintermediaries, making it comparatively slow and keeping operational risks high. Industry has begun to worktogether to determine how distributed ledger technologies could be used to solve these issues at scale."However, the Bank of England Governor warned that just because these efficiencies are possible, doesn't mean they will necessarily happen. He said:"It is not clear, however, that that the only challenges are technological. Indeed, the FCA highlighted earlier this week that settlement times could also be cut using existing technologies. This requires market participants to change their collective practices as it takes more than one intermediary in a chain to compress settlement times."Carney said the Bank of England is committed to "help build the right infrastructure for the financial technology industry to realise its promise."fintech has the potential to "democratise financial services," give consumers "more choice and keener pricing," "access to new credit" for SMEs, and "help make the system itself more resilient with greater diversity, redundancy and depth."He said fintech has the potential to "democratise financial services," give consumers "more choice and keener pricing," "access to new credit" for SMEs, and "help make the system itself more resilient with greater diversity, redundancy and depth."The Bank of England is working with fintech companies and Carney announced on Wednesday that it is accepting applications for the fourth round of its accelerator.The governor said: "We are looking to work on new proofs of concept on maintaining privacy in a distributed ledger and applying a range of big data tools to support the Bank's analysis."Earlier in the conference, Chancellor Philip Hammond said fintech is part of the so-called "fourth industrial revolution" and said: "Fintech will transform again the way we live and the way we do business."Hammond said that London is "at the forefront of the fintech revolution, changing the way in which financial services are accessed and delivered." He announced that Barclays is opening a new branch of its accelerator in, Rise, in London, with 500 desks. It makes it the biggest dedicated fintech booster space in Europe.But he cautioned that "we cannot and we will not rest on our laurels." The Chancellor said that, post-Brexit, Britain must "build trade links with those fast growing economies of Asia," such as India, where he led a fintech trade mission last week.Hammond closed by saying that business, investors, regulators, and government must work together "to build the world's greatest finch hub, right here in London."You can read Bank of England governor Mark Carney's full speech here and read Chancellor Philip Hammond's full speech here.Join the conversation about this storyNOW WATCH: A financial planner explains why starting a new job is the best time to negotiate salary
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