The popularity of BlockChain technology seems to be increasing each and every day. It began as a mad rash to purchase Bitcoins, a digital currency that is also known as cryptocurrency. This is because it is considered one of the most powerful BlockChain application in the real world. Since it is currently the most important means of transactions financial institutions have decided to carefully examine it.
Many organisations among the different industries are now taking BlockChain technology very serious. However, financial institution and banks have gone a step higher by trying to adopt it in the banking process. It is therefore not surprising to find financial institutions spending hundreds of millions of dollars in incorporating Know Your Customer (KYC) systems. Most senior officials in banks and financial institutions have even confessed to the fact that KYC systems give them sleepless nights.
Currently, trade finance in countries around the world is based on letters of credit, paper bills just to mention a few. However, BlockChain technology is proving to be beneficial since it is safe and secure. Instead of making payments using cash, all you have to do is use Cryptocurrency. This way, you can pay for payments without necessarily having to move from your current location. Furthermore, you no longer have to exchange currencies since Bitcoins are applicable in all countries.
Smart contracts have made BlockChain powerful by giving it more power to automate tasks. In addition to this, it has also given it power to put laws into code in order to execute whenever it is required on a decentralized, distributed ledger. Therefore, third parties cannot involve themselves in BlockChain innovation in banks as they rely on smart contracts.
BlockChain is a technology that is set to reach greater heights in the coming years. Before this happens, financial institutions and banks need to find a way on how they can incorporate it into their systems. Once this is done, we will stop relying on the paper money system when making payments.