“Did you know? 9 out of 10 agree that Blockchain will disrupt the banking sector and financial industry.”
― Mohsin Jameel
Blockchain had its humble beginning as a theme of computer science, which are linked using cryptography. Cryptography is linked with blockchain in finance. The first form of blockchain was a hash tree, which was also known as Merkle Tree. Blockchain technology has evolved into something greater and undoubtedly an ingenious invention. Blockchain technology allows pieces of information to be distributed but not copied where it created a new milestone in the new type of internet. Anyone can see the information in the block and everyone can see. It has no transaction cost and there is no authority. The information is passed from one person to another in a very safe and automated way. Decentralisation, transparency, and immutability are the three pillars of blockchain technology. The transactions which are executed and secured by a scripting language using cryptographic methods are blockchain technology in bitcoin.
Is Blockchain a Boon Or a Bane For Banking And Finance
Blockchain technology in banking is proving to be a great dare. Blockchain features high security. This factor in blockchain finance brought shifts in entire financial factors. Because of the tight competition in the industry brands are always in a good connection with banks. Customers want banking to be easy and they want responsive customer services. Banks from all over the world are enhancing blockchain to their finance system. The blockchain technology has newly emerged popular technology which enhances security, transparency, and immutability to the different process in a bank. Security and trust are two important factors that should be followed towards the customer. And that is the key part where real innovation comes to blockchain in finance.
Merits And Demerits Of Blockchain In Banking And Finance
This system benefits to the consumers in terms of convenience, even though it is not a secure medium and thus poses a number of risks. blockchain technology can speed up the transaction and makes the system more transparent and risk-free. It is expected to cut the massive day today working costs by this technology. It allows faster transaction within seconds. Since it reduces human intervention, it gives the most accurate and exact information. The information will be available at the right time.
Although we cannot declare it as complete secured technology and questions have been raised about systems security. The information of the user is shared with the third party without informing the user. Violation of security happens in many other ways. The collection of data of the user for an unnecessary reason and the financial records will be provided even if the customer asks for it. These are all some of the defects of this technology. Recording of personal information can be done incorrectly. And there are chances of losing customers personal data. However, there are chances to go through a number of cybersecurity attacks. Malware, SMS spoofing, Vishing, cybersquatting
are some of the emerging security attacks on the bank. As mentioned before the third party authentication is another problem faced by this sector.
Blockchain In Supply Chain Management
What is the supply chain? Have you ever wondered how life goes on? Several factors are connected to each other. The things we use in our daily life are connected to different factors. Production, distribution, manufacturing and many other factors like this are concerned with every product. The chain which connects all these processes is called Supply Chain. Maintaining a supply chain is a tedious and risky task for small businesses. Traditional supply chain management is concerned with lots of limitations. To gain a competitive edge in the industry a rapid expansion is attributed in each and every e-commerce companies.
It is beneficial to apply blockchain in supply chain lo to face various challenges like record keeping and tracking of products. Some of the advantages of blockchain in supply-chain management are:
- Eliminate errors, prevent theft and deters fraud
- Increase trust among parties.
- Improve inventory management.
- Being more reactive
Some anti reasons to consider blockchain are:
- It uses excessive energy
- The network is not provided
- Scalability is a weakness
- Higher cost and slower transactions
The blockchain supply chain is global and it involves many issues, however blockchain is in evolution and need to mature in the sector. Anyway, its position is rooted and started growing as the most promising technology that can solve supply chain problems.
Blockchain Today And Tomorrow
The potential impacts of blockchain technology have been discussed. The blockchain technology used first was Bitcoin a form of digital currency. Numerous companies and various organizations are taking advantage of blockchain nowadays. Capital One and Gem Health are examples for this where this technology helps to use the reduce time provided for the payment and other transactions. The companies like Bitproof has developed a blockchain based application to secure the contracts.
Looking ahead, the scope for blockchain is vast and endless.
Blockchain and artificial intelligence can help humans in the future. The future of ai and blockchain technology will be innovative. In the field of commerce, the potential use of blockchain can solve business problems. In reduced costs purchase orders, receiving reports, invoices, and payment could be created. In government sections, digital voting is an example where blockchain technology can be facilitated. However, this technology is one of the exciting technologies to have appeared in decades.