When organizations face a number of data-sharing challenges such as data integrity, transparency and traceability, they are looking for a new way to address these issues. This is where blockchain comes in. It is a decentralized technology store that consists of growing lists of records, or blocks, securely linked via cryptography and forming a chain that cannot be tampered with. Its key strength lies in its immutability, which helps reduce fraud and build a trustworthy ledger of transactions.
The technology is popularly associated with Bitcoins and other cryptocurrencies but it has many potential applications in different industries. In fact, blockchain is helping to reshape the business world by providing organized frameworks for secure data exchange between and among departments.
Traceability: Blockchain can help companies improve transparency in their operations by allowing them to track the origin of information. This can help them identify and correct errors faster. It can also help businesses maintain their legal compliance with regulations. It eliminates the need for third parties in some processes and provides a more efficient way to share data.
Efficiency: Various business activities are time-consuming and resource-intensive. A large part of foreign trade operations, for example, requires the processing and signing of numerous documents. These can delay shipment dispatch and hamper productivity. Blockchain allows these documents to be recorded in a digital form and verified, boosting the efficiency of foreign trade processes.
A combination of these strengths makes blockchain a good choice for many businesses, including banks. Using blockchain, they can create an organized system for sharing their financial information with customers and other stakeholders. It can also improve their risk management by tracking the status of loans and other assets.