Blockchain and Finance?
Much of the attention Blockchain devotes today is focused on financial services. Our global financial system moves billions of euros, dollars etc. per day and serves billions of people. However, the system is full of problems that cause costs through fees and delays, frictional losses through unnecessary and cumbersome paperwork, and opportunities for fraud and crime.
45% of financial intermediaries such as payment networks, stock exchanges and money transfer services suffer from white-collar crime every year. This figure is 37% for the economy as a whole and only 20% and 27% respectively for Professional Services and Technology. No wonder regulatory costs continue to rise and remain a major concern for bankers. All of this increases costs, with consumers ultimately bearing the brunt.
The question is: Why is our financial system so inefficient? First, because it is outdated, a collection of industrial technologies and paper-based processes in a digital envelope. Secondly, because it is centralised, making it resistant to change and vulnerable to system failures and attacks. Thirdly, it is unacceptable to deny billions of people access to basic financial instruments.
Blockchain technology can offer great advantages for financial transactions, lower brokerage costs with greater independence and transparency from banks. Blockchain-based financial transaction platforms offer not only the opportunity to fundamentally change banks' business models, but also to create new financial services and businesses.