Over the last decade, the financial sector has experienced unprecedented digital change. One of its main revolutions is undoubtedly blockchain, a technology that is here to stay in most professional fields. This sector was not going to be an exception.
Beyond Bitcoin, the blockchain has numerous applications that will very soon revolutionize financial entities as we know them. And, in a way, they are already doing it.
What is blockchain?
The blockchain is a decentralized information system. It is a kind of virtual account book where all transactions and operations are recorded (any exchange of money, an electronic record of votes, company billing, etc.). In short, a vast giant information network woven by millions of computers distributed throughout the world.
In this way, the security and integrity of all the information is guaranteed, since all the data that makes up the system (classified in blocks) has to validate the new information that is incorporated into it. In addition, being decentralized eliminates the need for intermediaries, which generates greater independence and reduced costs in the network.
Its best-known application is that which has to do with cryptocurrencies, a digital medium of exchange that uses cryptography to secure transactions, and which many experts claim can become the new money. In fact, everyone associates blockchain with Bitcoin, although there are other cryptocurrencies that are increasingly popular, such as Ethereum or Ripple.
However, blockchain is not limited only to its application to cryptocurrencies. It covers areas as heterogeneous as health, law, or logistics. And of course, also the financial sector, where it is one of the technologies with the most present and future.
The advantages of ‘blockchain’ for financial institutions
The financial sector is exploring all the possibilities that blockchain offers for the management of the banking business. Not in vain, nine out of ten executives are studying how to implement it in their entities, according to the publication Blockchain Technology: How Banks Create a Global Payment Network, prepared by Accenture Digital.
Over the last decade, the financial sector has experienced unprecedented digital change. One of its main revolutions is undoubtedly blockchain, a technology that is here to stay in most professional fields. This sector was not going to be an exception.
Beyond Bitcoin, the blockchain has numerous applications that will very soon revolutionize financial entities as we know them. And, in a way, they are already doing it.
What is blockchain?
The blockchain is a decentralized information system. It is a kind of virtual account book where all transactions and operations are recorded (any exchange of money, an electronic record of votes, company billing, etc.). In short, a vast giant information network woven by millions of computers distributed throughout the world.
In this way, the security and integrity of all the information is guaranteed, since all the data that makes up the system (classified in blocks) has to validate the new information that is incorporated into it. In addition, being decentralized eliminates the need for intermediaries, which generates greater independence and reduced costs in the network.
Its best-known application is that which has to do with cryptocurrencies, a digital medium of exchange that uses cryptography to secure transactions, and which, according to some visionaries, could become the new money. In fact, everyone associates blockchain with Bitcoin, although there are other cryptocurrencies that are increasingly popular, such as Ethereum or Ripple.
However, blockchain is not limited only to its application in cryptocurrencies. It covers areas as heterogeneous as health, law, or logistics. And of course, also the financial sector, where it is one of the technologies with the most present and future.
The advantages of ‘ blockchain’ for financial institutions
The financial sector is exploring all the possibilities that blockchain offers for the management of the banking business. Not in vain, nine out of ten executives are studying how to implement it in their entities, according to the publication Blockchain Technology: How Banks Create a Global Payment Network, prepared by Accenture Digital.
The financial sector is exploring all the possibilities that blockchain offers for the management of the banking business. Not in vain, nine out of ten executives are studying how to implement it in their entities, according to the publication Blockchain Technology: How Banks Create a Global Payment Network, prepared by Accenture Digital.
In any case, and regardless of how and where it is applied, this study concludes that the use of blockchain has tangible benefits for financial institutions, among which the following stand out:
- Reduction of operating costs.
- Much faster cross-border and cross-border payments.
- Fewer errors.
- New income opportunities.
- Greater independence.
- Better fraud prevention.
But perhaps the greatest advantage of the blockchain is its incorruptible nature and guarantee of greater security. Thanks to blockchain, data is protected and privacy in transactions is guaranteed.
But perhaps the greatest advantage of blockchain is its incorruptible nature and guarantee of greater security. Thanks to blockchain, data is protected and privacy in transactions is guaranteed.
The ‘blockchain’ is already present in the financial sector
Blockchain technology has been introducing new proposals for the management of financial services, such as payments, international money sending, and security management, among many others.
More and more entities and applications are using blockchain intensively in their business. In fact, according to the Global Blockchain Benchmarking study by the University of Cambridge, almost a third of the total blockchain registrations carried out in the world correspond to the financial sector.
Financing through ‘blockchain’
Large financial entities are increasingly turning to blockchain technology when granting financing and many of them have even been pioneers in its use.
