Originally blockchain was really just used as the technology that underpinned cryptocurrencies, but now this form of technology has become much more popular and is becoming present in many different industries.
Blockchain in the banking sector and cross-border remittance
The blockchain is able to store a record of every single transaction and validate it, without requiring any third party authorization and is decentralized. The industry we are now seeing blockchain be most commonly used in is banking, due to the level of security needed in this field and the ability of the technology to provide this.
The first way in which blockchain became useful to banking was as a form of payment, and both central and commercial banks are now using blockchain in terms of payment processing and even the issuing of digital currencies. The use of blockchain also means that cross-border payments are faster and less expensive than when done via traditional systems. This is because with blockchain remittance costs are 2-3% of the total amount, compared with 5-20% that are withheld by other third parties and no need for third-party authorization makes things move faster.
Eliminating third parties in industry value chains (IVC)
Stock exchange processes can also be made a lot simpler as a result of the blockchain, as the traditional processes can be quite time to consume and complex. The decentralized nature of blockchain means that unnecessary intermediaries can be taken out of the picture and trading can take place on computers worldwide. Trading transactions that take place in blockchain mean that there is an improvement in performance and reduces the redundancy of information. Smaller trading transactions can take place that can be handled outside the blockchain and it is only the final transaction that needs to be recorded, saving time and unnecessary information.
It is impossible to complete any type of financial transaction online without verifying your identity in some way and all the verification steps have to be completed for each different provider. Blockchain, however, makes it possible to identify verification to be reused by different providers as identity could be registered once and then stored and be available for the next time it is required.
Blockchain for loans
With the use of blockchain within finance, it is possible to assist those who are looking for personal or small business loans based upon their credit history. Traditionally completing credit reports has sometimes involved a lengthy process but tools that are available due to blockchain mean that credit reports will become more accurate, transparent and easy to share in a secure manner.
Blockchain P2P method
P2P transfers allow the transfer of funds from either a bank account or credit/debit card to another bank account through the internet, even on a mobile phone. There are many different P2P applications on the market now, but they have some limitations, such as geographical ones and large commission fees. These issues can be solved by decentralized P2P apps underpinned by blockchain. This is because blockchain does not have any geographical limitations, allowing real-time transfers anywhere across the world. This is a proving to be a huge advantage to services that operate online and mobile platforms. Therefore, we are seeing a rise in blockchain online casinos and other established brands such as mFortune mobile casino considering implementing the technology.
It is clear to see how blockchain is now having a very positive impact upon the banking world. It is likely that we will continue to see the presence of blockchain in many different areas of life. This will especially be the case as cryptocurrency looks set to be a widely used form of payment in anywhere from online casinos to restaurants in airports.