Blockchain and Distributed Ledger Technology can be used for a variety of industries, expected to revolutionize the way we do business in the banking industry, healthcare, government, retail and more.
Built on public databases that are openly shared among disparate users and creates an unchangeable record of their transactions, blockchain technology allows for all transactions to be cryptographically secured to ensure they remain tamper-proof.
There are several pitfalls in current e-banking systems, and building new alternatives on the blockchain could solve some of the more pertinent issues, making it more transparent, efficient, secure and cost-effective.
Here are the top 4 issues which blockchain could address:
- International transfers and the cost, time involved – with your current e-banking product, transferring money from one country to another often takes several days and involves a variety of third parties, each of whom take their cut from the transaction. Blockchain can provide instant transfers and all at very low costs.
- Reducing human error – one of the leading causes of fraud is related to human errors in accounting, record-keeping, and reconciliation. With blockchain, transactions are automated and cannot be altered later.
- Eliminating middlemen and increasing user trust – blockchain allows people to trade directly with each other, eliminating the need for middlemen, like stock exchanges and banks. This direct relationship between people can help foster trust in a new type of financial system wherein data is stored across many global servers rather than one centralized server.
- Overall cost-saving for both banks and customers – blockchain’s characteristics make it possible to automate some processes related to banking activities (for example, payments or issuing loans), which could save costs for banks and end-users alike.
Fiat24 Co-Founder Yang Lan said “coming from the traditional banking world myself, I witnessed many of the issues surrounding what can be considered now as ‘outdated’ technology in place in legacy banking systems. What blockchain can offer is an opportunity for the financial world to operate at a far more efficient level, with lower overhead and operational costs, as well as bringing several benefits to the customer.”
Fiat24 is a Swiss fintech with a unique proposition – using a utility NFT to represent clients accounts with the web3 banking Dapp they offer.
“We are the first web3 banking concept to be built entirely on the blockchain, and act as an additional layer to any digital wallet, effectively extending it from a crypto wallet to e-banking services. Our clients can top up their accounts using both fiat and crypto, do peer to peer blockchain payments which are instantaneous and without any downtime, as well as do quick and easy off-ramping,” says Nico Buechel, CTO of Fiat24.
Whether or not the big banks will catch on to how blockchain technology can transform their retail offering and bring them further into modernity or not, it is clear to see that there are young innovators already challenging traditional systems.