Industries That Blockchain Will Radically Transform Financial Services

 Industries That Blockchain Will Radically Transform Financial Services


The term “cryptocurrency” is a misnomer.
 
A common misconception, held by many newcomers to the blockchain world, is that the technology’s potential lies solely in the banking and financial industry. In fact, the recent suggestion of the Indian government to rename cryptocurrency as “crypto assets”, and Warren’s Buffett’s belief that Bitcoin is not in any way a currency, are perhaps closer to the true nature of cryptocurrency than the commonly held belief that it is simply digital money. Cryptocurrencies should not be seen as just money, but as tools. Blockchain technology, which underpins cryptocurrency, has potential in many more forms than just as a medium of exchange and store of value.

The application of this technology to industries as varied as supply chain management, fashion and publishing is a result of the innate flexibility of blockchain. The nature of a platform can be programmed to suit a variety of needs. The sooner an investor realizes this, the sooner they will see how exactly it might be applied to different industries, giving them a degree of clarity with can help them measure the potential of a project to disrupt a particular industry. Given the immense potential of blockchain, we take a look at industries that will be upended by its imminent commercial arrival. The shown here is as folows:

Financial Services

Without a doubt, the most popular application

and the launchpad for cryptocurrency into the global economy is the financial industry. The issue with today’s banking systems, as sophisticated as they are compared to decades past, is that they lack inclusion and fairness. Interest rates and transactions are heavily lopsided in favor of financial companies, and customers gain little from their interactions with banks. The situation is made worse when one notes that banking services are absolutely necessary. Individuals are forced into unfair deals. Additionally, there are billions in the world who have no access to a bank at all, which is an even worse circumstance to be in.

Cryptocurrencies and blockchain can universally rectify the situation. With a smartphone and an internet connection, both of which are widely available, anyone can bank, start a business and receive payments. With incorruptible ledgers and no centralized authority for oversight, financial services on the blockchain would place power back in the individual’s hands, offering solutions without exorbitant interest rates and middleman fees. The banking industry even suggests that up to $20 billion can be saved by eliminating infrastructure and middleman costs.

Bitcoin has first mover advantage, and we need only look at the news to see how Bitcoin has disrupted the financial industry. Ripple comes from a different angle – it seeks to work with banks and not do away with them. Ripple has drawn attention for its notable partnerships with many banks, most recently with Saudi Arabia’s central bank. Its emphasis on speed for large global scale transactions between banks and its growing network of participating banks has made Ripple a true disruptor.

Another cryptocurrency to keep an eye on in this space is OmiseGo. It is an Ethereum-based platform that has one very clear goal: to offer the full range of financial and payment services to any individual. They have an eye on the developing world, where many citizens are without a bank account. Their platform is designed to be agnostic between currencies – it does discriminate between fiat and cryptocurrency usage. A secondary objective is to help people transition from fiat usage to cryptocurrency usage.

Chuck Reynolds

Marketing Dept
Contributor

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