The blessings of blockchain technology over the finance sectors cannot be ignored. To emphasize more on the ongoing topic, blockchain consulting company Blockchainarmy chairman and Co-founder, Erol User visited the Bosphorus Summit 10 held at Istanbul as a Moderator of the panel.
Among the other panelists were, the CEO of Coinarmy – Peter Von Dam, the UN Blockchain Expert- Prof Massimo Buonomo, and the Chairman of Microfund Foundation- Prof Aziz Akgul, who gave outstanding presentations on the ways, blockchain is revolutionizing the finance sector. It was followed by Erol User himself, detailing about the manifold impacts that the blockchain revolution is bringing on the finance sectors. The remarkable presentation by Erol User was also lauded by the renowned markets fund manager and the founder of Mobius Capital Partners LLP- Mark Mobius.
Scopes of Blockchain in the finance industry
Erol User, in his speech, said that Cyber-attacks have become quite a common issue among banks and other financial institutions owing to the centralized databases prevailing in the finance sectors till date. Transitioning to the DLT reduces such risks of fraud and cyber threats to a manifold.
Huge Savings on KYC
The finance sectors need to spend a hefty amount every year to keep up to the KYC (know-your-customer) regulations. This KYC documents often fall prey to fraudulent activities in which the identity of the original customers is forged. Erol emphasized using blockchain in KYC that will help in reducing identity forge and hence, money laundering issues can be solved quickly.
Minimizes operational errors in various trading platforms
Moreover, using blockchain can also help in reducing operational errors and thus improves efficiency and reduces cost.
Erol, while detailing about the revolutionary impact of blockchain, said, “The insurance is the bidding contract between two parties that involves a number of steps such as premium payment, filling claim, etc. This technology may change the way of insurance business runs by replacing the legal contract.”
How Can Blockchain Benefit the Finance Industry?
The benefits that the finance industries are reaping from the blockchain technology are numerous, but Erol pointed out the most crucial ones in the Bosphorus Summit which impressed the eminent delegates present at the summit. He pointed out the following benefits.
Wiping out the bureaucratic authority
The decentralized database of blockchain technology can help to reduce the costs associated with international payments. Both parties in the international agreement can benefit from the validity time of the transactions thereby, ignoring the bureaucratic authority.
Smart contracts using the blockchain technology can automatically improve the contractual term performance once the pre-set conditions are met. This hugely benefits the banks and other financial institutions.
Eliminates Middlemen and Brokers
Blockchain eliminates intermediaries and thus provides for speedy transactions. Traditional Spot trading though claims to be spontaneous, is not so. In fact, they take 2 to 3 business days to settle the transactions.
Makes peer-to-peer transactions possible
Blockchain helps in making the peer-to-peer transactions possible for the customers, therefore eliminating the useless fees that the custodian banks and clearers charge.
Erol concluded his speech requesting financial institutions to adopt blockchain technology in its various sectors. He assures the banking and finance industry that the manifold benefits that blockchain can offer will spike its demand in the years to come and bring in more security and reliability in the transactions.