Blockchain technology has been known to be what’s used on cryptocurrencies like Bitcoin. However, the use of this tech can actually go beyond that. Many other industries can easily benefit from using this technology like finance and banking.
This technology is mainly keeping track of the transactions or trades that are made online. This could help promote transparency and trust between trading partners. For cryptocurrencies, this technology has made it easier for its users to track the completion of payments or trades made.
Blockchain is basically a secure ledger or a secure list of transactions. This is found beneficial for crypto users because it makes all transactions decentralized. This means that trades and transactions will not require approval to go through.
This simply makes transacting with cryptos generally cheaper and quicker. With all the benefits that the use of cryptos have, here are some ways that the blockchain technology is changing finance and banking.
Direct payments mean lower or no fees at all
When banking, it’s common that it would take time before a wire transfer or payments get posted. This is because such transactions with the bank will usually require one or even multiple approvals to get through.
With that process, people or employees are involved, and so this means that someone will have to pay these people. That then equates to the fees that people pay for payments and transactions to be processed.
Blockchain allows direct payments and traders to directly pay each other. There’s no need for both merchants and customers to pay for these fees as they themselves will be the one to process the payments in a secure manner. Merchants, in particular, can avoid swipe fees with this. Meanwhile, customers or consumers can finally avoid overdraft fees.
Another thing that blockchain can help with is to ensure that all transactions are safe and possibly anonymously sent. Fraudulent activities are less likely to happen when using this technology because of all transactions, no matter how big or small, are tracked and are irreversible.
Blockchain tech can resist hackers, DDOS attacks, and other kinds of fraudulent activities. Unique Blockchain IDs can help determine whether the trade will go to the right person. That. Now, with low fraudulent activities, a business can lower down its costs.
This tech can tremendously help marketers, manufacturers, sellers, and the consumers to have a more direct transaction and so online scamming is less likely to happen. If it does happen, the activity will be easy to trace.
Another thing about security that the blockchain can allow its users to have is anonymity. Instead of having to write down personal information like the full name, bank account number, or the social, only the unique blockchain ID is necessary. Identity theft is basically almost impossible to happen.
This is something that still has to be explored, but using blockchain tech with this can make it easy for people to track their debts and progress as people pay off loans. Any transaction can’t be easily removed and so accuracy is what it really promised by this technology.
Debt firms like the National Debt Relief can benefit from this. Not only the staff of such institutions can find this helpful, but also the ones who are also paying for a debt or debts. The application of this tech would make tracking debts and payment simpler.
Smart contracts can be generated and tracked through blockchain. Mistakes on posting the payments are not likely to happen. Any trouble with a person’s payment history can be easily checked because of this.
Banks are now already using blockchain tech for remittances world. Bitcoin, in particular, is an alternative way to move or send money, but many banks nowadays already have their own blockchain technology to help improve their existing remittance services.
When this is u for transfers, it’s primary to think that banks will then save money on billable hours are transactions are then only made online or through a bank’s machine. However, this is also very beneficial for consumers.
When traveling, it could take a long time to withdraw a specific amount of money from your bank account. This is because banks are very careful about such transactions. With cryptos or the use of blockchain, the transaction will be more direct and won’t really require any approval.
These are just a few ways that the blockchain tech has affected the banking and financing industry. Many banks are already using, but it’s still not as popular as many hopes it should be. Decentralization is still a topic that many people have a lot to say about, but experts see that blockchain will eventually be the norm in banking.