Blockchain Can Help End The Fraudulent Business Activities

Yes, you heard it right. However, surprisingly no one seems to care about the power of underlying technology – blockchain. Apart from powering the cryptocurrencies such as Bitcoin, blockchain technology has the potential to create an unmatched level of trust in recording business transactions without third party involvement. To understand the phenomenon, all you need is to understand how blockchain works.

Blockchain technology is a decentralized network of computers, where data is cryptographically recorded, encrypted and stored in a block and each new block gets connected with the previous ones. Let’s analyse its few other benefits that how it can help limit fraudulent business activities.

Preventing Identity Theft

Identity theft can prove to be highly expensive for both businesses and individuals. On average, businesses lose almost $16 billion to identity theft fraud every year. Moreover, the time used to reconcile accounts details, emotional stress and fear of future happening that individuals experience are also the hidden costs of identity theft. You may not believe that blockchain technology can end identity theft crisis by powering a personalized, cryptographically encrypted and ID system.

The end-users will have more control over the kind of data that they choose to share with businesses such as credit card details will be shared once you buy the stuff. Moreover, blockchain offers strong security, which will protect personal data from unauthorized access as every log-in details will be recorded. Any malicious attempt cannot go unnoticed and it will become easier for businesses to take proactive and preventive measures instead of reactive ones.

Making Supply Chain Management Efficient

The global economy has become incredibly interconnected, so it has become hard to scrutinize the chain and find its origin. Along with supply chain, there is a massive value chain acting as a custodian of trade at the apex of every channel such as manufacturing, transporting, production, advertisement and banking. The issue arises when it becomes practically impossible to investigate, evaluate and verify the quality control from the raw material finding to the finished product along the entire stretch of supply and value chain.

For instance, if you buy a pure cotton shirt from a shopkeeper, you have to rely on the words of vendors that it is 100% pure cotton – the vendor has to believe on the words of supplier and the supplier relies on the words of the manufacturer. However, with blockchain technology, it will become easier to record every entry and verify the claims along the supply chain because the entry is encoded with the proof in the blockchain. And buyers would not have to worry about fraudulent claims as they can be verified at any level.

Outdone the Escrow System

If you are an international entrepreneur and work beyond boundaries then you must know about escrow services, as they are a significant part of business transactions. People use escrow system when it comes to buying international property, business transactions as it is a major driver of the international economy.

The issue becomes serious when you will have to tie huge sum of cash while waiting for the other party to fulfill their agreement. You will also have to pay a service fee to the escrow company. Along with that, you have risk that the escrow company may be compromised, fail in business transaction or may be tricked into releasing funds to the wrong person.

With blockchain technology, people can have seamless transactions between both parties where you may add a third party for trusted transaction. You can create simple contracts between counter parties. It means there will be lower cost of business transaction because you do not have to pay for service charges to the company. Both parties can place money into cryptocurrency form without having to worry about the credibility of company.

 

How Could Blockchain Technology Change Finance?

 

The trending cryptocurrency thrill is rolling over every sector in the current era. The Initial coin offerings (ICOs) are quite impactful on the traditional capital-raising. So evidently blockchain technology is strongly effective in the major transformation of the world. When benefits of revolutionary distributed-ledger technology is highlighted global banking system is the one which strikes the mind. So call it the payments, settlements or compliance, blockchain’s major attributes of decentralization, immutability, efficiency, cost-effectiveness and security are leading to a new major level of reshaping the financial services.

Application of blockchain in the Banking Sector:

Delayed transactions, extensive investment & minor results, frauds, money laundering all the major problems let the competitive environment of banking into the dens of desolation. Repetitive checking, investing time & resource into something which can be treated by a simple technology which allows to eliminate all the hassles which prevent the banks from achieving success. Modification is the key to major achievements when it comes to strategies of development. Have you ever considered getting your work done in applying the minimum resource? Have you ever experienced transparency when you’re managing multiple accounts? Have you ever thought of getting a cheaper, faster & secured system when it comes to transactions? Can you ever believe that your processes can be automated & the results can be achieved faster?

By implementing blockchain in banking sector all your queries can be resolved simply. The technology allows you digitize everything, from traditional cheque system to trade finance. The application of this technology would decentralize the system overall. This allows to remove the extensive time-consuming process of counterchecking and multiple participants. The chances of error is minimized as the technology offers extreme security & transparency. It goes from multiple parties to peer to peer computing banking, reducing number of entities. The manual process which takes ample time & resources is replaced with the decentralized ledger. The documentary fraud can effectively be eliminated. Apart from that eradication of exhaustive workload is insured. Moreover, the documents can be dealt intelligently and are verified in no time. Have you ever wondered how contented it feels to be on the same page? Blockchain technology empowers you in achieving the maximum results, consuming less time. As for the banks, the tiring process of LOC is shifted on Blockchain, saving time & money. That is the major reason for rapid growth in the sector of banking as it brings about massive results in a short span.

Banks today are now focused on improving their cross-border payment capabilities which could easily be addressed by this technology. All what we need is the acceptance of recent development exactly as the communication industry adopted internet for succession.

What is blockchain?-Introduction to Blockchain and its benefits.

 

It is difficult to understand new technology particularly when the technology isn’t something that you can see and touch. Blockchain is one of those technologies. In most recent years, people started to take interest in Blockchain technology.

But most people out there have no clue about this technology. Here is the brief introduction of the blockchain for everyone who is looking to dig deeper into the subject.

Introduction to Blockchain

Blockchain definition is founded by Satoshi Nakamoto who is the founder of Bitcoin. Bitcoin is a digital currency, invented in 2008. In the past decade, with the revolution in technology, Blockchain is also growing very fast.

Blockchain is a decentralized network that distributes the data of its transactions all over the network. Blockchain was also published in Gartner’s Hype Cycle as one of the emerging technologies in the next 5-10 years.

Looking back to the half era of computer technologies are mainly centralized. Blockchain has distributed ledger that can store transactions. A distributed ledger is one of the keys, shifting from centralized to decentralized. So, Distributed ledger (also called shared ledger) can be described as a ledger of any transactions which is stored on different sites all over the network. There is no centralized database.

Key features of Blockchain

Here are some key features of the blockchain.

1) Decentralized System

2) Safer and Secure System

3) Immutable

1. Decentralized System:

Blockchain is a first decentralized system in which data are store on multiple sites. In which there’s no single authority that approves transactions. If one or more nodes fail, the database remains accessible.

2. Safer and Secure System:

Blockchain is the safe and secure system because Blockchain is series of blocks that store data in Hash functions with the timestamp that’s why data cannot be changed or overwritten. Banking and payments, cybersecurity, Supply chain Management, Forecasting, Network and Internet of Things, Insurance, Cloud Storage, Charity, Voting, Government, Public Benefits, Healthcare, Energy Management, Online music, Retail, Real Estate, Crowdfunding and many more are working on adopting Blockchain Technology to make their business faster, more efficient and secure.

3. Immutable:

One key feature of blockchain is immutable (unable to change). Most of the people think is it immutable? Yeah, it is. In blockchain, data cannot be changed. No duplications occur. Unchangeable records can be created. Once data has been written in blockchain we cannot change it, not even system administrator can change it. It is a key pillar of trust among strangers or even in smart contracts. It is useful for the database of financial transactions.

Use cases of Blockchain

Blockchain has abundant of use-cases, some of which are given below.

1.Blockchain in Banking Sector

Blockchain in the banking sector can help us to revolutionize it with amazing features. Our current existing banking sector depends on central authorities causing high charges and yet no security in contrast to Blockchain. If our banking institutions are converted to blockchain we will be able to save extra money going for the funding of central authorities while providing increased security and transparency. Blockchain shall not be limited to the monetary processes only instead they can be helpful in other industries including the medical field, music, art, loyalty programs, insurances, capital markets etc.

2. Data Credibility

Blockchain ensures the security and transparency of different forms of data. In governmental processes, for example, Blockchain can help us regulate the voting processes. Here it can be very helpful in avoiding the issues such as rigging and fake votes etc.

3. Real Estate Transparency

In real estate world, it can help us in validating the property rights and securing the property transactions which in turn can save us from stealing and fraud attempts on properties.

In the Supply Chain Management, Blockchains are currently being used to solve problems by eliminating the need for a trusted third party to certify raw materials, components, or finished products, as they travel through a supply chain.

From recent hype of blockchain and cryptocurrencies, it is no more an exaggeration to claim that Blockchain is, in fact, one of the most swiftly emerging technologies of the new era. Blockchain can help us solve the issues of traditional network systems ensuring maximum security, transparency and immutability making it almost impossible for the hackers to attack the network. It is already being incorporated in many businesses including loyalty programs, jobs portals, health sector, capital markets, real estate and many more. It is no doubt that we will be seeing blockchain as a common ingredient of many new startups.

Things Everybody Need to Know About Blockchain

 

While going through technology and financial news, you may have observed “blockchain” and “cryptocurrency” popping out. Maybe you also read up the concept, but still unsure about it and its principles. Blockchain technology is not much different from the things you already happen around. It is a wave of future that backed Bitcoin innovation.

Blockchain technology enables people to create entries into a public record just as Wikipedia. Users can then amend or update the record. The record/ledger is not a property/product of a single person hence, allowing all users to control it. Blockchain technology is truly decentralized, fairer, and more transparent than any public ledger.

To know more about blockchain properties, click this link.

So, how does blockchain Works?

With no new technology, but a combination of technologies, blockchain is a revolutionizing technology – a step towards the transparent and decentralized world. It comprises of private cryptographic keys, distributed ledger, servers, clients, blocks, and identities.

Blockchain is a systematic set of data that is processed through mining, where each block get identified by a hash and timestamp. By creating and assigning crypto keys using cryptography rules, the node initiates a transaction.

But, what is blokchain transaction?

By transaction, we are not talking about your  financial transaction. But, every action took over a blockchain platform is known as transactions. It can be a transfer of values, relevant rules addresses, and sources between users and network. It may include transfer of money too.

How transfer takes place?

The process is so simple. Validators/nodes verify each transaction then to include it in a block to propagate it onto the network. As the block gets into the decentralized ledger, it then connects itself with other blocks using cryptography rules. Once added, data becomes immutable or tamper-proof.

Whereas, block in a blockchain is like a unit/page of a ledger containing all information about timestamp, digital signature, and transaction data.  A consensus has to achieve for validation, to verify each transaction for new block generation.

So, the above mentioned is a summary of basic blockchain terms and its operation. To learn more about blockchain technology and its implementation, subscribe us.