How blockchain technology is used in the fintech industry
Blockchain technology has unquestionably transformed the financial services industry, and if you need a quick refresher on what blockchain technology is, please click here.
So how exactly are fintech companies utilizing blockchain technology? For starters, the digital ledger helps fintech businesses through its distributed and decentralized structure, by successfully enabling massive levels of security, efficiency, and equality among financial companies and organizations around the world.
In other words, this modern technology makes a lot of everyday business tasks easier and safer in the fintech industry. Financial organizations can rely on fewer errors and fraud taking place. Instant, secure financial transactions, settlements, and payments are ensured. Blockchain is even simplifying major accounting processes such as auditing procedures, bank reconciliations, and general bookkeeping methods.
Essentially, the distributed online ledger greatly reduces the chances for setbacks, while resolving major financial issues such as identity theft and other operational inefficiencies at the same time.
Top 10 Benefits of blockchain technology in fintech
Companies in the fintech industry are benefiting from blockchain technology in numerous ways. Not only does the advanced digital ledger add value, save huge costs, and eliminate third parties for businesses, but it has created a new sense of financial freedom in the world of finance. Here are the top 10 benefits of blockchain technology on fintech businesses:
- Permanent data storage
- Traceability and transparency
- Increased level of reliability
- No intermediaries or middlemen
- Reduced transaction fees and costs
- Enhanced client experience
- Expanded consumer markets
- Quicker transactions
- Enriched security
- Reduction in fraud
20 Popular blockchain cryptocurrencies
Blockchain technology has become quite famous since its debut in 2008. There are now over 18,000 different types of cryptocurrencies available today, and collectively, they have a total market cap that exceeded $2 trillion just last month.
Here are the 20 most popular cryptocurrencies that are currently available:
- Bitcoin (BTC)
- Ethereum (ETH)
- Tether (USDT)
- BNB (BNB)
- USD Coin (USDC)
- XRP (XRP)
- Solana (SOL)
- Cardano (ADA)
- TerraUSD (UST)
- Shiba Inu (SHIB)
- Wrapped Bitcoin (WBTC)
- NEAR Protocol (NEAR)
- Polygon (MATIC)
- Cronos (CRO)
- Dai (DAI)
- Terra (Luna)
- Avalanche (AVAX)
- Dogecoin (DOGE)
- Polkadot (DOT)
- Binance USD (BUSD)
How will blockchain technology change the future of fintech?
This game-changing technology is only going to expand and integrate deeper into the financial world. And with blockchain technology becoming an essential resource, fintech companies are going to have to readjust their business models and incorporate the blockchain infrastructure to keep up with competitors.
Blockchain is going to revolutionize the future of fintech businesses by eliminating the need for excessive paperwork, security vulnerabilities, costly and timely transactions, and possible corruption. All fintech platforms and businesses will be able to automate complex workflows without a problem, meaning financial procedures that would normally take days or weeks to perform, will be completed within hours due to this dynamic technology.
Blockchain technology has already had a huge impact on well-known financial institutions, such as Bank of America, JP Morgan, Swedish Central Bank, State Bank of India, and Standard Chartered. And according to Statista, “the global blockchain market revenue was heavily distributed towards the banking industry, which has a market share of almost 30 percent.”
This technology is also positively impacting the global digital payments sector. After the Coronavirus pandemic disrupted the world in 2020, the volume and value of digital transactions skyrocketed, and “the global digital payments industry grew by 16% year-over-year and reached $5.4 trillion in value”, simply because of blockchain technology.
Conclusively, with the demand for “fast and transparent financial services”, the fintech industry has no choice but to accept blockchain technology. Adopting the technology is the only way fintech businesses and platforms are going to be successful for years to come.
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