As we steer through pandemic in the wake of COVID-19, the next big thing we all should be aware of is the collapsing global economy. With dooming economies and collapsing businesses, there would be a need for end-to-end financial restructuring. This won’t be just limited to new business ventures, cross manufacturing, alternate revenue strategies.
There is a lot to learn from this pandemic, and would probably help to build better and sustainable business ventures. Blockchain technology is one of the hot topics amid lockdown.
What does market forecast say?
According to a report by Juniper Research, blockchain deployments will empower banks to accumulate savings on cross-border settlement transactions of up to $27 Bn by the end of 2030, plummeting the costs by approximately 11% per transactions.
Let’s take a tour of trending financial segments that have already deployed blockchain technologies.
How Financial Segments Are Deploying Blockchain Solutions?
More and more industries are discovering the usefulness and benefits of integrating blockchain technology into their systems.
Currently, several parties are involved in trade finance. Unfortunately, this makes the whole process very slow and complicated. This brings up trust issues, and the only way to get there is to use even more intermediaries, such as clearinghouses, financial institutes, or banks.
The way blockchain can help here is through smart contracts. Smart contracts are automated contracts. They are executed automatically with specific instructions in the code that are executed when certain conditions are met.
Charity and donations
For those who make charitable donations, blockchain offers the ability to track exactly where your donations are going, when they arrived and in whose hands they ended.
From there, blockchain can provide the accountability and transparency necessary to respond to perennial complaints about charitable giving. This includes the organization’s inefficiencies and its financial offense that can keep the money from reaching the people as it was is intended.
Loyalty and gifts
Blockchains can help retailers offering gift cards and loyalty programs to make these systems cheaper and safer. With fewer intermediaries required to process card issuance and sales transactions, the process of acquiring and using blockchain-based gift cards is more efficient and profitable.
Likewise, increased levels of fraud prevention, thanks to the blockchain’s unique authentication capability, also help to reduce costs and prevent hacking from illegal users.
For years, companies have worked to facilitate stock buying, selling, and trading, and now new startups focused on the blockchain are trying to automate and protect the process more efficiently than any previous solution.
For example, the investment division of the Dutch bank ABN AMRO collaborated with the investment platform BUX to create a blockchain application called STOCKS. The app keeps users’ ABN AMRO money in a blockchain bank account for stock trading. The use of a private blockchain intended to save money for users and the bank.
Blockchain helps to reduce the risk of conventional cybersecurity by merely eliminating the need for human intermediaries, reducing the risk of hackers, corruption, or human error.
Ironically, some of the most successful blockchain companies are centralized intermediaries, and many new projects deployed for sale and purchase of blockchain-based currencies, blocking the entire stock market.
In short, blockchain is a benefit for financial services, as it aims to bridge the gap between regulators, financial institutions, and consumers. It is accompanied by a forewarning about the initial investment that will be needed to bring all these agencies together on one common platform and work collaboratively. While it is true that they need to overcome obstacles, the fact is that the great utility they bring to space is fascinating.
We at Panacea Infotech, considering the foreseeing the demand for blockchain-based solutions is equipped with expertise that can build future-ready blockchain-enabled solutions for your businesses.
Connect to explore, what’s next?