The Blockchain Revolution In Banking

The Blockchain Revolution In Banking

The Blockchain Revolution In Banking

The blockchain, it’s a result of modern innovation and development which is a common subject these days and has always had a positive contribution in making our lives easier. It has grown deep roots and influence in the world of finance, e-commerce, and trade. As a whole, it has eased the paradigms of bankers and economists in this century.

For an instance, think of an outdated ledger, based on huge sheets and fancy books that organizations used to keep track of their dealings and transactions, creating an official record that was meant to be reviewed by the responsible one.

Now have a look at the advanced type. Consider the online version that can easily be accessed by multiple people or parties taking part in the transactions, it’s secure and gets updated in real time. Yes, we are talking about blockchain! And it’s bringing a rapid change to global trade and finance.

The core concept of the blockchain is to diversify, as well as revolutionize the sets of procedures being followed in a transaction. Although the said concepts are still under development phase, it can play a crucial role in different sectors and industries, especially e-commerce and banking – due to easy adaptability and hassle-free procedure.

Organizations/companies can enjoy real-time and easy access to their funds and extend businesses across the globe, constant circulation of money might result in boosted funds (for short-term investments) and working capital of an organization. Incorporation of such a system might bring a handful of perks for bankers; real-time deal settlements, reduction in “default risks” while providing improved automation.

How blockchain works

The blockchain enables person-to-person dealings or transactions. It’s private, secure and cost-effective (it takes down the middle man during the action). To understand that, assume you made a purchase from the blockchain for food delivery (I’ll prefer a cheesy double-patty burger). All you have to do is to choose a restaurant by its reviews and place the order. Once it’s at your doorsteps, you might want to pay for the food and delivery charges generated by blockchain. The deal seems to be cheaper because there was no one in the middle to go hard on your wallet (in our case, that can be Food Panda or any online delivery service).
Let’s dive-in deeper and shed some light over the actual process. It can be replaced with the current system given that it’s not an all-new infrastructure. Blockchain is made up of individual chunk of data (let’s suppose chunks as blocks) connected with a transaction, followed closely by each other.

How-blockchain-works

So what is a blockchain?

A blockchain is made up of individual blocks of data involving a series of related transactions, linked together in consecutive order. Blockchain allows individuals to share digital records across different networks – without having the need to fulfill any extra obligations and requirements.

For instance:

Sarah wants to send money to Jacob
The transaction takes place in a form of block, coin or token, online in a database.
The block is visible to every person in the network or participating in the transaction.
The involved parties approve the transaction
After validation, the block becomes part of the chain, which provides an unchangeable and transparent record of transactions.
The money transfers from Jacob to Sarah.

Benefits of Blockchain

Having all the details pinned down, the benefits are quite clear; Blockchain holds the responsibility to bring flexibility and efficiency to the transaction process involved within industries and banks. Simple and real-time transaction across countries and money can be transferred/received within a short span of time.
If blockchain becomes a prime mode of banking, the reliance over commercial banking giants will be abolished and will be replaced with fast and secure service. The transactions and exchange of money across the globe will be cost effective as no one in the middle will farm its share, or at least the share rate imposed will drastically fall down. The system and procedure of Blockchain are universal; it doesn’t have to adhere to specific laws of any country, it is the same for every individual, therefore, practically it’s in favor for everyone. We can give more power to global today and help small businesses promote interact with each other across the borders while making transactions easier than ever!

Benefits-of-Blockchain

Blockchain promises to create a cross-border network through which money is exchanged at the speed in which information moves today.Click To Tweet

 

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