In recent years the use of Blockchain technology has gained huge popularity in the business world. The decentralized nature of this technology has played an important role in increasing the use of this technology by most industries. This nature makes it secure as compared to any other technology. Any entry recording in the blockchain ledger cannot remove or edited without receiving consent from other members of the chain. That means as soon as any transaction is recording in the chain its information is visible to all the members.
All the industries from education to health care to finance and sports are finding the potentials of its use by them. For this, they are taking the help of blockchain consulting firms to manage their activities and help them in adopting this technology.
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Blockchain and Finance Industry
The finance industry is one of the most sensitive industries requiring protection from fraud and other fake activities. Adopting this technology helps them in minimizing the chances of fraud, controlling the cost of their operation, and cutting administrative costs.
How blockchain can benefit financial services?
Some of the benefits which finance industry can enjoy by adopting this new technology are:
Instant Transactions
As any transaction that takes place in the blockchain records in the ledger. It makes the whole process fast and speedy. The process of verification used by the banks is long and time-consuming. With the use of this technology, it is easier to verify any entry within a short period of time. With the use of blockchain technology and banking software, the transfer of funds or any activity will be performed instantly.
Reduces the Operational Cost
By adopting this technology the backs can reduce their operational cost. With the help of blockchain contracts, it is easier to minimize expenses on intermediaries and maintenance costs. Therefore, there is no need for intermediaries for monitoring and processing transactions between banks. With the help of blockchain technology, it is easier to settle transactions between two parties without help from a third party.
Security
Due to, the use of blockchain technology offers strict security. The hackers don’t get time to access the transactions or hack the payment during the transaction. Every activity on the blockchain is performing instantly and quickly. There are some chains in which there are two keys. One key gives to every user, and the second is gives to the participants in the chain. The hackers are only able to see the process of transactions. As has been noted cannot know the details of the parties involved. Thus, it is not possible to hack the transaction during the process.
Accountability
Similarly, it is also one of the most important benefits of using blockchain technology. The use of this technology helps in tracking and verifying the transaction easily. It helps in controlling the fabrication of data and other types of errors. The money transferred to any account is performed digitally and its entry is recorded several times.
Transparency
Transparency is the term that suits blockchain technology in a true sense. Every transaction that takes place within the chain records instantly. Moving ahead it is easier for any member in the chain to trace it. This increases the practice of transparency between the members. However, most people are scaring of this practice. Keeping this fact in concern there are different types of safety measures adopted by this technology.
For instance, some of these safety measures are:
1. Zero-knowledge of proof technology: This helps in verifying the user data without its disclosure.
2. Enigma Secret Contracts: With the help of the enigma network and protocols it is easier to encrypt the data within a smart contract.
3. Confidential Transaction: It is based on homomorphic encryption and helps in hiding the amounts transferred.
Money Transfer Made Easy
The use of this technology has made the transfer of money to any corner of the world without any difficulty. Earlier, the people transferring and receiving the money had to face the problem of delay in the transaction. The use of blockchain has made the money transfer simple, instant, and economical in the entire world.
In conclusion, these are some benefits which Financial Services Industry may enjoy by its adoption.
Read more: “Why Know Your Transaction is a Jump on the Bandwagon?“
