How Blockchain Can Transform The Fintech
FinTech was born in 1950 by introducing the cutting edge technological solutions into the Financial sector. From credit cards to ease the burden of carrying cash in the 50s, to ATMS, electronic stock is trading, sophisticated data and recording keeping systems on mainframe computers, and electronic stock trading. However, it was not until the 90s that the industry started to boom leveraging the Internet to create e-commerce business models and solutions. This boom has changed how money is spent, lent, sent, and exchanged through online gateways and PoS terminals.
This is why when people talk about FinTech these days, it tends to center around that app that let them buy coffee without leaving their couch; mobile wallets to shop from anywhere in the world; robo-advisors to help manage wealth and plan for retirement; online lending platforms with zero risks, and crowdfunding platforms for accessing alternative opportunities for investors.
Blockchain is a publicly distributed electronic ledger network. This ledger openly shared and accessed among disparate users and creates an unchangeable record of their transactions by linking each time-stamped transaction to each other and distributing the record to all users. Because information is distributed among users all over the world, no single entity can control the blockchain effectively making all recorded information on its network immutable and irrefutable.
FinTech is one of the major sector where blockchain and crypto currency has affected and made a splash. While much has been made about how disruptive blockchain can be for the industry, FinTech has already staked its claim in innovation, and continues to show that while this emerging technology can help, it’s certainly not required.
FinTech is started when it was a necessity and the solutions made by the industry like credit cards, ATMs and many others that e can use online with the help of computers and mobiles and other devices today.. What started as a small industry boomed with the rise of the Internet and has taken on a life of its own, complementing the financial institutions and services that support the modern economy.
Despite the promise blockchain holds, the FinTech industry continues to find new ways to solve existing problems on its own, providing better accessibility to more people in the process of its own evolution.
Reasons for FinTech disruption
The FinTech ecosystem grows constantly. Individual technologies in a vacuum can no longer be embraced by the companies. Companies must consider their roles within the full FinTech ecosystem. They must determine when to collaborate, build or buy. To become more collaborative, they must determine how to break down walls they have built over time to protect their enterprise and still stay safe. Decisions made today will have long ranging impacts.
Where does blockchain fit into an innovation strategy?
Blockchain technology has the potential to universally reshape the way business transacts across nearly every industry in the global economy.
The distributed infrastructure’s ability makes the technology an important tool in building trust among business and consumers.
One of the fastest growing industries of this decade, the world has welcomed the FinTech industry with open arms. Day-to-day banking, trading and investing have moved online; mobile payments are widely accepted on e-commerce platforms; online currency exchanges, equity funding, and personal finance apps have made it possible for anyone with internet to access the same financial options that were once reserved for those of a certain economic stature. Among companies in FinTech, those benefiting the most are start-ups. Block chains provide users and companies in FinTech a decentralized network to share secure information, and provide the unalterable transfer of data. With the invention of Smart Contracts, Blockchains can ensure the obligations of both parties are met before a transaction or agreement is completed.