Here are some highlighted blockchain finance solutions that are estimated to bring in value to enterprises for the long-run.
Finance is known as the most active sector in implying advanced technologies. As a whole, finance is all about the activities of studying, creating, and managing the flow of money and investments. It is decentralized, immutable, and transparent characteristics of blockchain that create a new transformation model to process those activities. As a result, many operation activities of financial institutions blockchain finance solutions are applying blockchain finance solutions to gain more benefit.
A brief blockchain in finance
Starting with the explosion of Bitcoin and other cryptocurrencies over the last decade, finance has been the most popular sector while mentioning blockchain. Therefore, it is no surprise that finance is also the most successful implementation of blockchain applications when it comes to enterprises.
But different to cryptocurrencies, blockchain finance applications does not work with money; it’s about what this technology can do to the operating activities of an enterprise.
According to Gartner’s report, in 2019, blockchain in finance is accounting for 30% of blockchain engagements by vertical, yielding the BFSI market value of more than $277.1 million in 2018 and is estimated to reach $22.46 billion by 2026, reaching a CAGR of 73.8% from 2019 to 2026 (based on data of Allied Market Research).
These number is counted based on the practical applications of blockchain in finance.
Three ways finance enterprises are using blockchain to transform their business
Considering the business values that blockchain brings in the game of finance, enterprise blockchain platforms trying to harness these values to develop relevant blockchain finance applications.
Although there are a considerable number of blockchain applications created by multiple blockchain finance platforms, here are the three most high value-added solutions that we assess as having great potential for long-term development in financial businesses.
1. Identity verification with Digital ID (DID):
One possible solution of blockchain in finance is to determine the digital identity of a specific human. DID verification is the activity of verifying particular characteristics of a person (both normal identity and behaviour ones). The more specific characteristics, the more clarity it gains.
Credit scoring and eKYC are two successful ones of blockchain-based digital ID among other blockchain finance applications.
Particularly, to a financial institution, controlling and harnessing the value of customer data to know where and how people are using money is very important. To a person, issuing them an exclusive digital identity gives them a chance to approach to financial services that they are prohibited before easily.
2. The automatic process with Smart contracts:
A blockchain smart contract is a concept of a self-executing digital agreement. The point of smart contract on blockchain is using business logic to implement terms of the agreement and carry them out automatically once the conditions are met.
In general, financial systems have been facing with inefficiency because it doesn’t focus on using data to solve business rules but unconsciously stores and transfers those through parties and layers. This is such a waste of time and resources to deal with a large number of non-valuable processes.
That the data on the blockchain database is stored and verified with transparency helps blockchain smart contracts to simplify the process of executing an agreement. Because, once data is already transparent, there is no longer the need for an effort to implement the verification process.
Smart contracts are now implied to handling automatic payment settlement and handle bulks transactions.
3. Transferring financial information and assets for Insurance:
The insurance claim process inherently carries on with tons of fraud and abuse. The transparency and immutability of blockchain contribute to financing a reliable method to transfer information and assets. Combine with smart contacts; blockchain applications are deploying to reduce paper-work and enhance insurance activity.
akaChain blockchain finance solutions
Only a few enterprises are implementing long-term strategy in their businesses, while wealth is primarily generated by long-term thinking.
With blockchain, saving time with blockchain is not the story of saving time in each action. Instead, it’s a long-run plan when we can cut off wasting time in waiting for verifying and solving the problem with low-value data and errors.
From the perspective of an enterprise blockchain platform, akaChain collaborates with enterprises to build applications that create long-term value for all financial components, including both individuals and governments.
Distinctively, our Credit scoring and eKYC helps to open a new approach to both individuals and financial institutions. The idea of these solutions is to collect data from various sources of all financial activities, instead of banking-related activities only. From this reliable and transparent database, parties can easily track and verify information more effectively.
akaChain believes that with these head-to-basic blockchain applications, financial institutions can own a strategic piece of the puzzle to the financial big picture.
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