How is the blockchain technology applied to the banking industry?

The biggest feature of blockchain technology is decentralization, which will reduce a lot of costs for the banking industry.

First of all, decentralization means that the trust mechanism between banking systems no longer needs intermediaries, saving the cost of intermediaries.

Secondly, the development of digital currency will make it possible for banks to conduct real-time digital transactions. For example, in the bill transaction, the bank's bill transaction has always relied on the third party to realize the delivery of valuable documents. Even electronic bill transactions need to be authenticated by the information of the central bank ECDS system. Blockchain technology can realize point-to-point value transfer without centralized system control, which not only speeds up the delivery of bills, but also reduces the mistakes caused by human factors. The reduction of process will naturally reduce the demand for personnel and save the labor cost of banks.

Finally, it will also have an impact on clearing and settlement. The clearing and settlement business of banks has been completed by centralized settlement, which is inefficient. Settlement through blockchain technology will greatly improve the efficiency of banks.

Blockchain technology also plays an important role in the cross-border payment business of banks. In today's highly developed global trade, cross-border payments are becoming more and more frequent, and banks often act as third-party services in cross-border trade, such as electronic transfer and asset custody. However, cross-border payment generally takes about 2 days to arrive, which is inefficient and reduces the utilization rate of funds in transit. In blockchain technology, cross-border payment can be completed point to point, realizing all-weather payment and real-time payment, thus speeding up the clearing and settlement speed and further improving the efficiency of bank business.

Another feature of blockchain technology is to go to risk. Banks can establish their own blockchain, which can ensure that the transaction information and records of bank customers are true and effective and will not be tampered with at will. Banks can effectively identify customer information, understand all aspects of customers, identify abnormal transactions of customers, and prevent being deceived by customers, thus reducing the supervision cost of banks.