Cryptocurrencies and Blockchain Technology are paving the way for digital transformations in the current world. Moreover, the global financial economy is already transformed into higher levels. This is with the implementation of Blockchain Technology in them. It is emerging in its full operational deployments and disruptions of fundamental processes. This is particularly related to the buying & selling of goods.
Additionally, the financial services industry contributes around 20% of the global GDP it seems. As the global financial system deals with a plethora of data every day, it is important to make them secured.
These financial sectors have a lot of intermediaries to process the operations. This includes Stock Exchanges, Payment processors, Money transfer services, etc. Thus, Blockchain could be a feasible solution to get rid of the major problems involved here.
Why Blockchain in Financial Sector can be beneficial?
Here are the four major reasons why Blockchain can be adopted than other popular technologies in the financial industry:
- Payment and data transfers facilitated by central authority are still the same. It has been more than a decade. Moreover, international transfers would take more than four days. With this, there are risks associated with credit/debit cards, exchange rates, etc.
In addition to this, industry too will involve a high amount of transaction fees. With Blockchain Technology, all these transfers can be made cheaper & faster which other technologies lack.
- Most of the industrial processes are delayed for an upgrade or other issues. This is to withstand security, hacks, higher volumes, etc.
Thus, by implementing Blockchain Technology, the process becomes more feasible as there is no centralized system involvement.
- There are greater chances that people would start making smaller transactions and payments. Hence for a smaller transaction, having a larger transaction fee won’t be better. With Blockchain, we can expect higher volumes and lower transaction fees.
- Blockchain Technology will also enable further disruptions of the traditional banks with fintech. Legacy problems, new participants, etc can utilize the blockchain platform to remain benefited.
In addition to this, Blockchain can be beneficial with the following factors:
Let me explain to you these main challenges and how blockchain can solve them in brief in the upcoming section.
Challenges in the Financial Sector & How Blockchain solves them efficiently:
- The Need for Decentralization
Most conventional financial systems are based on traditional centralization. As we have discussed earlier, it involves a great number of intermediaries to facilitate the transactions. This can, in turn, take additional time and cost for operation.
In addition to this issue, centralization lacks security. Security plays a couple of roles here. Initially, higher-level managers & individuals have access to employee and customer data. There are chances that they can use it for their beneficiary purpose.
While on the other hand, data are equally considered as gold. With centralized systems, customer’s sensitive data is held in central servers. This means that even a single breach of data can lead to the access of millions of records for the hackers.
With Blockchain in Financial Sector, one can eliminate the intermediaries by cutting down & saving time and money. The decentralized nature of Blockchain Technology will eliminate both these risks.
A consensus on a decentralized platform involves an agreement. This should be accepted by all the network participants. Hence, the decisions are not made by a single party but a set of individuals with the desired expertise.
Moreover, the data is not stored in a single server. They are spread out and encrypted throughout the network. So, there are no chances of fraudulent activities to take place. To hack this, hackers have to access the complete record of data which is impossible. Thus, Blockchain’s decentralized nature can secure the data efficiently.
- Cost-Savings for Border Payments
Because of its cost-saving benefits, the industry of finance is experiencing high-level changes. International Payments have become more expensive in recent years. These border payments include a lot of intermediaries to operate them. Hence, the cost involved will also be a bit higher.
By implementing Blockchain in Financial sectors, transactions can be completely streamlined leading to efficient yet instant transactions. It not only makes the cheaper but also safe & secure. This is done by handling the transactions over a reliable blockchain network and eliminating the intermediaries.
According to a recent report, it is stated that Blockchain technology could save up to $12 billion every year. Thus, Blockchain solutions can cut off additional and unwanted costs with international payments.
- Invoice Management & Billing
Managing a huge amount of data is always a daunting task not only in Finance but in every sector. Most of the financial companies have started adopting electronic invoicing. However, this equipment lacks the standards that are required to execute invoicing in the financial sector.
An Invoice usually contains a couple of steps:
- Verifying and tracking the information
- Forwarding & receiving the invoice information
Thus, while processing these two steps, it is important to store and maintain the data effectively & securely.
Financial companies can now upload their invoices with Blockchain through Smart Contracts. Invoice information such as Due date for payment, the total amount to be paid, the client’s personal details, are stored in the Blockchain Network.
Once the person pays his/her bill, the smart contracts update the data accordingly as “Paid”. Hence, Blockchain can help to make the decision if the client is safe to get started with trading.
- Know Your Customer (KYC)
Banks and financial firms have implemented strict concerns with the cost involved with KYC & AML. These tasks consume a lot of time and money for the banks for every single individual.
One of the popular mass & information media firms called Thomas Reuters unveiled that the overall expenditure of this process ranges from $60 million to $500 million every year. Moreover, financial institutions should now have to upload the KYC data to their central repository to perform these.
With the adoption of Blockchain in Finance, the individual verification of each client by a financial organization will be accessible for other banks as well. This means that the duplication can be completely eliminated with Blockchain Technology.
In the same way, all the updates of the client’s will be visible to all the financial institutions. This would result in the reduction of Admin efforts & costs from the financial department representatives.
- Trade Finance
Trade Finance is considered to be one of the most useful applications of Blockchain in Finance. All the involved parties go with a complex mode of transactions Financial companies are planning to use Blockchain to save the immutable funds of finance-related information such as profits earned, MoM, financial history, etc.
With Blockchain in the financial sector, all the participants in the transactions will have access to the information shared by exporters, importers, banks, etc. Once the particular conditions are met, smart contracts start executing. Hence respective parties can view all the actions performed.
One of the popular statistics states that an Israel-based startup along with Barclays has successfully executed a trade transaction that takes around 7 to 10 days. But with Blockchain Technology, it was a matter of just 4 hours. Thus, when comparing to the traditional architecture, the usage of blockchain can drastically reduce time as well as the cost.
The future of Blockchain in Financial Sector:
The future of blockchain in finance is drafted every single day to make it reach higher levels for an efficient process. Once these Financial firm starts adopting Blockchain Technology, they can taste real success in them.
More and more intermediaries start emerging, Financial sectors would realize the importance of Blockchain Technology. Added, Liquidity is one factor that is entirely rendered by Blockchain compared to other technologies. Undeniably, with these top-notch facts, we can expect the Blockchain development company worldwide to cater to all these resources.
To put it all together, we can notice a very bright future for Blockchain Technology in Financial Sector. This technology would effectively enable financial transactions a bit easier, cost-effective by enhancing liquidity.
Crypto Writer at a leading blockchain development company. I love to share my ideas & thoughts on Blockchain & Cryptocurrency in a simple & readable manner.
Crypto Exchange Binance Under Investigation by Department of Justice and IRS
Crypto exchange giant Binance is allegedly under investigation by the U.S. Internal Revenue Service (IRS), as well as the Department of Justice (DOJ) for money laundering and tax evasion.
BREAKING: Binance, the world’s biggest crypto exchange, is under investigation by the Justice Department and IRS https://t.co/mk0Njo7tUE
— Bloomberg Crypto (@crypto) May 13, 2021
According to Bloomberg, the federal probe is confidential, with both the DOJ and IRS having “sought information from individuals with insight into Binance’s business.” The report accused Binance of succeeding without strong government oversight, with its lack of corporate headquarters and incorporation in the Cayman Islands — which levies no taxes and offers more lenient business practices.
“We take our legal obligations very seriously and engage with regulators and law enforcement in a collaborative fashion. We have worked hard to build a robust compliance program that incorporates anti-money laundering principles and tools used by financial institutions to detect and address suspicious activity,” said a Binance spokesperson in response to the recent probe.
Binance and Crypto Markets Continue to Face Regulatory Scrutiny
One of the biggest criticisms of Bitcoin and the crypto space at large has been their use for criminal activity. Back in January, Treasury Secretary Janet Yellen raised concerns over cryptocurrencies being used in terrorist and illegal financing, with other major financial figures like Charlie Munger associating the industry with “kidnappers” and “extortionists.”
Chainalysis, a blockchain-based data analytics firm used by U.S. federal agencies, reported in 2019 that Binance saw more funds tied to criminal activity than any other exchanges based on the transactions that it had analyzed.
“Binance and Huobi lead all exchanges in illicit Bitcoin received by a significant margin. That may come as a surprise given that Binance and Huobi are two of the largest exchanges operating, and are subject to KYC regulations. How can they be receiving so much Bitcoin from criminal sources? Let’s start by looking at the specific accounts receiving illicit funds at both exchanges.”
This is certainly not the first time Binance has been embroiled in legal troubles. Recently, the exchange’s venture into tradable stock tokens landed the company under the scrutiny of European regulators, including the U.K’s Financial Conduct Authority (FCA) and Germany’s BaFin. In March, Binance hired former U.S. senator Max Baucus as a regulatory advisor.
Featured image from UnSplash
Coinsmart. Beste Bitcoin-Börse in Europa
Kraken Daily Market Report for May 14 2021
- Total spot trading volume at $3.17 billion, 5.3% higher than the 30-day average of $3.01 billion.
- Total futures notional at $638.8 million.
- The top five traded coins were, respectively, Ethereum (+2.3%), Bitcoin (-1.4%), Tether (0%), Dogecoin (12%), and Polkadot (-0.6%).
- Strong returns from Dogecoin (+12%) and Synthetix (8.5%).
|May 14, 2021
$3.17B traded across all markets today
Crypto, EUR, USD, JPY, CAD, GBP, CHF, AUD
#####################. Trading Volume by Asset. ##########################################
Trading Volume by Asset
The figures below break down the trading volume of the largest, mid-size, and smallest assets. Cryptos are in purple, fiats are in blue. For each asset, the chart contains the daily trading volume in USD, and the percentage of the total trading volume. The percentages for fiats and cryptos are treated separately, so that they both add up to 100%.
Figure 1: Largest trading assets: trading volume (measured in USD) and its percentage of the total trading volume (May 14 2021)
Figure 2: Mid-size trading assets: (measured in USD) (May 14 2021)
Figure 3: Smallest trading assets: (measured in USD) (May 14 2021)
#####################. Spread %. ##########################################
Spread percentage is the width of the bid/ask spread divided by the bid/ask midpoint. The values are generated by taking the median spread percentage over each minute, then the average of the medians over the day.
Figure 4: Average spread % by pair (May 14 2021)
#########. Returns and Volume ############################################
Returns and Volume
Figure 5: Returns of the four highest volume pairs (May 14 2021)
Figure 6: Volume of the major currencies and an average line that fits the data to a sinusoidal curve to show the daily volume highs and lows (May 14 2021)
###########. Daily Returns. #################################################
Daily Returns %
Figure 7: Returns over USD and XBT. Relative volume and return size is indicated by the size of the font. (May 14 2021)
###########. Disclaimer #################################################
The values generated in this report are from public market data distributed from Kraken WebSockets api. The total volumes and returns are calculated over the reporting day using UTC time.
Ternoa Blockchain’s NFT-based data transmission project gets LVT Capital as a partner
Ternoa Blockchain has found a new partner as it introduces its NFT-based data transmission service to the market.
The company received an investment from Australia-based private equity firm LVT Capital to form a strategic partnership aimed at enhancing the sustainability, innovation, competitiveness, and dependability of Ternoa’s services that allow users to build time capsules for safely transmitting their memories and important data to their descendants even after death.
Building on LVT’s Expertise
With its focus on blockchain, crypto, and tech projects, LVT Capital has already proven its expertise in these areas with its numerous collaborations and investments. The company has already made investments in more than 40 top-caliber crypto, real estate, finance, education, and cybersecurity firms with 200 more under evaluation for potential collaborations.
LVT Capital has the market and technology expertise as well as the resources to enhance Ternoa’s unique service and promote it to boost the company’s competitiveness. For instance, LVT Capital has its own media & marketing services and an online publishing arm focused on blockchain, technology, and business, which makes the firm a perfect fit for Ternoa.
Ternoa Blockchain Offers Customizable Time Capsules
Ternoa Blockchain found a new way to use NFT and blockchain technologies to help people handle their data storage and transmission needs, which is one of the reasons for LVT Capital’s decision to invest in its business. With its Polkadot-powered, NFT-based customizable time capsules, people can securely transmit their memories such as photos, videos, and other important data to future generations or simply use the platform as a secure storage solution.
Ternoa’s platform is flexible enough and gives users several options on how they wish their data to be retrieved by their intended recipients. The available transmission protocols are Safe Protocol, Consent Protocol, Death Protocol, D-day Protocol, and Countdown Protocol.
- Safe Protocol – Data owners can retrieve data at any time, which makes use of Ternoa as a secure and portable storage solution.
- Consent Protocol – Recipients can access the time capsule as long as the original owner does not use his veto option.
- Death Protocol – The time capsule will be delivered to the beneficiaries upon the death of the creator based on local death registries APIs.
- Countdown Protocol – Introduces a countdown feature which can be set to1 month, 1 year, or 10 years. The time capsule will be delivered to the recipient if the countdown reaches the limit. The creator can reset the countdown at any time.
- D-day Protocol – Time capsule can only be accessed on a specific date, which is set by the creator.
While the loss of data is always an issue for other data storage solutions, Ternoa eliminated this risk by making copies of the files inside the time capsule, which are stored in other dex storage blockchains. At the moment, Ternoa sends these copies to Aerweave, Sia, and Storj while keeping the original version in its network. To learn more about the project, click here.
IMPORTANT NOTE: This is a paid press release, which BitcoinerX has posted as part of a commercial agreement. BitcoinerX is not responsible for producing this content and does not endorse the products or services mentioned. It is the responsibility of the company posting the press release to ensure the material is credible and accurate. BitcoinerX is not responsible for any damage or loss caused to anyone who chooses to use the company, product or services mentioned in the press release. BitcoinerX does not recommend using the information in the press release to form the sole basis of investment decisions.
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