A lot has been discussed and is in the mainstream about blockchain technology in cryptocurrency trading. There is an equally or perhaps more sophisticated and sensitive, but established application of the online ledger in banking. Whether it comes to operational routines or regulatory management in finance, new ventures based on this technology are rapidly surfacing and gaining appreciation.
Delimiting to one or two aspects of financial institutions is similar to unseeing the numerous possibilities offered by the digital database in a revolutionary form. Personal banking and corporate banking have to be dealt with different approaches in the economy and apart from giving priority to the personal and professional details, identities and transactions of the customers, banks have several underlying layers waiting for the real digital transformation. Three areas where blockchain technology can make the laudatory effect can be comprehensively reiterated here.
Financial payments: inflow and outflow
Releasing new digital currencies, storing, using them for carrying out regular transactions and market trading are efficiently managed by the ledger technology. When it is possible to get a financial management system with an inherent proof-of-work protocol, payment systems definitely get the advantage. The banks are able to handle more choices of payment modes without any kind of discrepancy in data or security.
For inviting funds, token offerings are getting more preference from the side of the banks since they come with the convenience of digital ledger management along with the ease of conversion to cash. As more and more customers prefer to carry out online transactions, documentation, back-end support and record-keeping are safe in the custody of blockchain database.
Handling personal banking creates challenges when the customer base and their transactions increase. However, the files are separate entities of manageable sizes and do not create a real havoc in banking operations. The scene is different when traders, both small-scale and large-scale enter the field. The autonomous functioning and credibility of Bitcoin Trader robot and the similar platforms is a proof of how digital power can make multiple things smoother in a single stream. The same information may be retrieved by multiple customers, the same application may have to be passed through several windows and deal with more sensitive data. Some processes may take years and thousands of paperwork. When computers are doing the tasks with the help of human effort, a digital peer-to-peer network has a lot more to offer.
Financial statements and clearing
Current affairs are now flooded with non-performing assets and bad loans and settlement errors. Transparency in banking from the side of the regulatory authorities, efficiency in clearing outstanding transactions, settlements, loan communications from the mutual sides of the employees and customers can be achieved by a blockchain system.