Blockchain and the Fintech Industries: Have you heard the word cryptocurrency recently? If not you surely would have heard of bitcoin, or ethereum and another well-known cryptocurrency. Cryptocurrencies are based primarily on the blockchain. Other technologies and even some established organizations have delved a bit into blockchain and its applications. It is believed that blockchain will find a great deal of application in the fintech Industry. The benefits of blockchain application will cut through all fabric of everyday life.
Technology keeps advancing and the merits keep increasing too. In fact just recently at Davos in Switzerland. As technology keeps advancing, it seems that more application for blockchain keeps showing up. Even as the possibilities seem to be forever increasing, only a few blockchain companies have made an impact in the industry. In reality, the potentials of the industry still lie fallow and it is very ripe for harvesting. One major setback, for now, is that few methods to monetize the applications of blockchain except for the funds gotten from ICOs which are often crowdfunded. In Fintech, however, there seems to be hope for blockchain application.
The Fintech industry has made enormous leaps in innovation and may seem to be able to survive on its own without the need for the inclusion of blockchain. But in reality, the use of blockchain can add some measure of security and accountability to the already vibrant industry.
Why Blockchain Technology May be Necessary
Blockchain technology has one feature (DLT) that makes it a viable prospect for Fintech industries. This technology increases transparency. The Distributed Ledger Technology makes transactions carried out on the blockchain platform to be more open, everyone can monitor their transactions and trust is engendered. This openness is one of the fortes of blockchain technology. Persons are aware of the financial crisis that happened during the end of the first decade of this century and they are wary to repeat the same mistakes. Trust cannot be compromised and a technology that increases trust will always be favored.
Another advantage of blockchain technology is that its systems and networks are decentralized. Having a decentralized network makes it tougher for hackers to crack compared to a centralized system. Put tersely, blockchain offers more security than the current centralized systems.
Dr. Kay Swinburne understands that Distributed Ledger Technology has much value to offer the financial markets and as such blockchain will be valuable to financial markets too. She also spoke on the attributes of the technology recently at a financial conference held in London. She made a remark that showed that the public acceptance of blockchain will be based on professional acceptance despite the potentials the industry presently has.
Despite the potentials that this technology possesses, skeptics feel that the bubble will burst just as some other technology prospects such as the dot-com prospect of the late 90s.
A Viable Industry
The Fintech industry has made a lot advancement most of which have been necessary for conducting transactions easily. ATMs and other technologies used in online transactions have all been products of the Fintech industry’s innovations. The industry has grown way bigger than it was in the beginning and it will only grow bigger. The benefits of the Fintech industry’s innovation s are felt by persons who engage in everyday transactions.
The industry also finds useful applications in the lending business. It has found ways of making lending less stressful than what the conventional institutions have to offer. There are a lot of persons out there that require such services. One of the players in the industry has done well in perfecting its lending services- EZBob.
EZBob offers bigger companies a better processing platform to ease the lending process. It is called Straight Through Processing. Using this process, banks and other financial companies find it easier to offer lending services and at the same time compete with smaller, leaner lending companies.
EZBob, Paypal, Addepar are all Fintech companies that have all come up with innovative ways to ease online transactions, improve security and create reliable online investment platforms. One can say that on its own, the Fintech industry evolves and finds solutions to the challenges it meets along its path.
In conclusion, while the blockchain technology may be necessary, because of its Distributed Ledger Technology, the fintech industry has been doing just fine on its own. Yes, Fintech industry will prove to be better with blockchain technology, still, the ways the Industry has evolved has shown that it can chart its own course with or without blockchain technology.