Casey D. Cain works as a project manager and logistics specialist for an international investment firm. In the following article, Casey Cain discusses how blockchain technology is revolutionizing financial transactions and security.
By now, most digitally savvy people understand the power of blockchain. But while it's impacting all sorts of industries, the financial sector is undoubtably the most transformed. So much so that
44% of worldwide blockchain revenue was garnered from payment applications last year.
And that's only the beginning. Experts believe blockchain is leading the all-new technological wave in the financial landscape — one that's been on the horizon for years.
The technology has impacted payments and security of such transactions in a myriad of ways that won't be stopping any time soon.
Casey Cain Notes the Unparalleled Speed
Accelerated speed is expected by consumers for every digital endeavor in the modern, developed world, so it's evident that blockchain's ability to rapidly send and receive money is an attractive impact for the financial space.
Efficiency is the driving force behind its speed. The blockchain is capable of settling transactions in mere moments while costing $0.01 or less — saving money and accelerating commerce.
Speed and the Stock Market
Casey D. Cain reports its quick pace doesn't just benefit consumer and business transactions; it could also bring quicker settlements to the stock market.
While not currently widely used, many major stock exchanges are investigating the potential of blockchain to allow near-immediate stock settlements by reducing operational costs and transaction time.
Those at TechDay say such entities will utilize
smart contracts to automate compliance and assure exceptional transparency.
Taking Steps Toward Smart Contracts
Casey Cain notes that, speaking of smart contracts — they are like traditional contracts with one major difference; they execute automatically when pre-set conditions are met.
As most know, contracts are a massive part of the financial sector, and organizations spend unbelievable amounts of time working on them. But with self-executing contracts, the process becomes incredibly streamlined.
While there are plenty of applications for smart contracts, insurance is perhaps the best example. Insurers could utilize these all-new contracts to accelerate the claims process. As soon as a client issues a claim, it would be automatically reviewed by the programmed code. If it's deemed valid, the smart contract executes and pays the client.
Such happenings aren't widespread at the current time. However, some brilliant minds believe it's a near-future occurrence.
Unbeatable Security and Privacy for All Online Payments
Casey D. Cain says that fraudsters always target financial organizations — a statement that has only become truer as digital payments boom. Such transactions carry significant risks of information stealing as they pass through banks and payment processors.
Blockchains, however, halt that.
The technology uses cryptographic algorithms to process and record transactions. Thus, cryptography can be used by financial companies to reduce the high risk level when processing payments and monetary transfers.
Casey Cain says that consumers also benefit from this extra secure revolution. Blockchains utilize public and private keys which encrypt transaction information. In other words, personal information is invisible, ensuring it won't become vulnerable to wrong-doing hackers.
Making Cross-Border Payments a Breeze
Traditionally, international payments relied on long-winded authentication processes as transfers must occur between banks in different geographical locations upholding varied regulations. It's a process that can take days — but not with blockchain.
This technology utilizes a decentralized network, negating the need for a plethora of intermediaries to authenticate and process transfers. Payments are authenticated in real time using data already within the blockchain. Upon acceptance, the transaction is added to the chain to ensure traceability, making a historically days-long ordeal a few seconds to conduct.
Casey D. Cain says that this applies to both B2B and P2P transactions.
Peer-to-Peer Cross-Border Payments
These transactions occur between two people. Blockchain technology facilitates affordable, quick international transfers, thanks to its worldwide reach and decentralized characteristic. Payments flow straight to the intended person without intermediaries getting in the way and slowing proceedings.
Business-to-Business Overseas Payments
In the same vein, it solves the otherwise lengthy process for business-to-business (B2B) payments too.
In fact, Casey D. Cain explains that many companies around the world are already realizing this glaring fact. A survey conducted by PYMNTS in July 2022 shows that
37% of businesses are already using blockchain for overseas transactions for secure and rapid ease. And this percentage may well have risen since!
With impacts like these, it's no surprise that blockchain technology is as revolutionary as it is for the financial sector.
