The potential of blockchain technology has caught the attention of the world. A huge crowd around it is looking for opportunities to adopt and leverage the benefits of this technology in their business.
The financial sector is taking the lead in adopting this technology. The main focus of the financial sector is to create connected groups of people together and allow the transparent and secure transactions. A blockchain is a tool that helps accomplish these things on a global scale.
Blockchain democratizes information and access to it, paving the way for shared operating models, more efficient processes, reduced costs, and new products and services in banking and finance. Blockchain enables more open, inclusive, and secure business networks. It enables digital securities to be issued within shorter periods of time, at lower unit costs, with greater levels of customization. Digital financial instruments can be tailored to investor demands, expanding the market for investors, decreasing costs for issuers, and reducing counterparty risk.
Though now we know that blockchain technology is responsible for bringing in a major transformation in the finance sector, you must be aware of the areas where the technology will streamline the process. Below are three use cases of blockchain technology in the banking and financial sector.
One of the areas where blockchain penetration is fastest is payments. Payments are crucial as people primarily use their bank accounts for transactions.
Banks have been on the bandwagon of digital transformation for quite a long time that motivated them to adopt disruptive technologies for seamless payments and issuing their own digital currencies.
With the use of blockchain technology, banks can leverage the following benefits.
1) High-level of security while transferring money
2) Quick and safe transfers
3) Real-time transactions
4) Round-the-clock service
5) Feasible and faster cross-border payments
A hedge fund comprises a group of investors and a fund manager with limited partners. Those involved in hedge funds are usually traders instead of ordinary investors. Hedge funds focus on increasing investor returns and reducing the possibilities of losses.
From the past couple of years, hedge fundraising has doubled due to cryptocurrencies. A decentralized hedge fund offers an open platform for investors and fundraisers that is more transparent. This blockchain-based hedge fund is based on crypto.
Here are two reasons why it is important to adopt blockchain-based hedge fund model.
– Sovereignty of fund managers over money
– Enable fund managers to work within a single entity
Currently, as per the traditional financial infrastructure, a bank transfer takes a couple of days for the settlement. With the decentralized blockchain technology, banks could settle directly and keep track of the transactions in a much better way .
One of the logistical challenges that numerous banks face is moving the money globally. A bank transfer has to undergo various complex processes and bypass intermediaries such as custodial services before it reaches its destination.
With blockchain technology, banks can track all the transactions transparently and publicly. Blockchain enables banks to simply settle the transactions directly on a public blockchain. They don’t need to rely on any kind of custodial services.
RoboFi (www.robofi.io) is a Defi platform that envisions a marketplace for revolutionary Dao crypto trading bots. Through its IBO (Initial Bot Offering) system, community members can maximize their earnings in an easy, simple, and secure way. We create a safe and transparent environment based on blockchain technologies that help developers bring crypto trading bot platforms to the market. In addition, individuals will have easy access to these bot applications, thereby generating more earning opportunities. RoboFi ecosystem is fueled by the $VICS token.