Credit: https://www.devteam.space/blog/5-examples-of-blockchain-uses-in-financial-services/
When we speak about technology and banking, one of the most disrupted industries by Blockchain is finance. Nowadays, distributed ledger does not need any special introduction; it is not only disrupting the banking industry, it is also making the foundation for the future. With the advent of Bitcoin, everyone has seen the potential of virtual currency in the banking and financial domain. Moreover, blockchain enabled systems are able to achieve scenarios which were not possible at all.
In the landscape of banking, with a little transaction, cross-border transactions are possible within seconds. Most of the traditional banks are struggling to maintain the expenditure on old technology, and blockchain is offering what is required by the banks.
In contrast to the above, regulations, compliance, and fear of overtaking the traditional banking business, banks are taking proactive steps to embrace blockchain and cryptocurrencies. Moreover, due to volatility in the cryptocurrency market, fear among the banking organizations has increased. To overcome these issues, Victorieum has come up with the solution of setting up an offshore crypto bank and crypto exchange with fiat conversion.
The global banking industry is more than $134 trillion, and most of the banks play intermediary roles for payments, loans, cheque clearing, trade finance and mutual funds etc. Trustless system provided by the blockchain will disrupt various domains of banking and finance, underneath are few of them:
Payment
Blockchain technology offers settlements of cross-border and in-country payments with negligible cost, high security and remove the need of multiple intermediary parties. Currencies such as bitcoin and ethereum were built on this concept, users car transfer the funds on public blockchain with fewer transaction fees. Victorieum will build the similar digital ecosystem where payments across the globe will be simpler and economic.
Loans
Peer to peer lending is another disruption of blockchain technology. In a traditional was, banks have to analyze the risk, derive the credit score, and see the customer portfolio before approving the loan, however with the help of the decentralized system, it is easy to take the decision and provide independence on loan disbursement. The cryptographic hash will help to pull out the global credit score of the customer to approve the loan.
Clearinghouse
It is a mammoth task to scan, get the balance information and settle the cheque with the help of inward and outward clearing. Transferring cheques from one place to another is a pain for both customers and banks. Two banks balance has to reconciled before settling the cheque. With the help of blockchain technology, banks have estimated to reduce this cost by 30%. Victorieum is building an offshore banking which based on the similar concept of removing the intermediaries for cheque settlements.
Trade finance
Blockchain has made an international trade very simple and fast, with the help of smart contracts, letter of credit and letter of guarantee can be put on blockchain to avoid misinterpretation of goods and money. Moreover, the decentralized system will overtake the lengthy process of releasing the funds and dispute settlement.