Blockchain Technology for Banks: Uses and Benefits

Banks have been a pillar of the economy for generations. Strongly regulated, they have acted as the main means of financing that both individuals and companies have had at their disposal.

While they have always offered us certain services without problems, others have sometimes been more complicated. In 2019, the financial institutions are even stricter in all their jurisdictions.

And that’s when it happened. It was then that the future came into our lives. Bitcoin emerged with its fascinating technology. Initially, known by few but its enormous potential did not allow it to continue like this for a long time.

It is a fact that the banks felt threatened. It’s so reassuring to know you’re hardly there. What you do and undo as best suits you. Whatever you do, they will count on you for lack of alternatives.

And suddenly, there comes a technology capable of changing everything, even your way of working. Neither can they deny the incredible benefits of Blockchain technology. There are a lot of Blockchain use cases with banking industry.

Currently there are banks considering the Blockchain technology application, even carrying out tests to implement it. In addition, big banks also are investing in many startups that are providing interesting solutions based on blockchain.

And, it is not surprising that they’ve taken such a step. Along with a study conducted by a firm called Accenture Consulting, the global banking industry could save up to 20,000 million dollars by 2022 if the blockchain-based solutions were applied. It will also cause to produce a lot of product hunt careers.

So, what blockchain technology can do for banks?

Clearly, change everything. Blockchain technology is capable of potentially disrupting the manner banks and their customers interact. Reducing the bureaucracy, costs and time that currently seems necessary for the realization of transactions between institutions but that does not have to be.

Blockchain technology would avoid the need to use intermediaries, for example clearing houses. In this way, they would eliminate the fees they charge for their services.

At the outbreak of banking crisis, there was a requirement for banks to improve their basic Level 1 capital requirements. That is, capital destined to guarantee the continuity of activities. This capital allows a bank to continue its activities and maintain its solvency. As a prevention that guarantees that the bank has sufficient resources to continue its activity and be solvent if an economic slowdown or an external shock.

 

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