Blockchain application in finance and business

Blockchain application in finance and business

From the smart contract application, just a few small transformations, transforming the features or integrating with other technologies, the extremely diverse Blockchain application product chain is born.

Blockchain technology in stock, bond and fund market markets

Blockchain application in finance and business

For example, with the traditional bond market, investment banks will act as intermediaries for management and coordination. When a company wants to issue bonds, that company will authorize the investment bank, which then organizes the sale of bonds to funds. 

But with Blockchain, the bond market has changed. That company can now create a smart contract that specifies the terms and conditions of bonds. Investors will set the price that they accept (in cryptocurrency, or in real account money). 

By the time specified, the smart contract is activated and automatically arranged, selecting the best bidders who meet the conditions of the contract. So the transaction takes place without a third party to coordinate or stand out, it also means that the transaction fee is significantly reduced, processing time is faster because there are a lot less another time. 

Moreover, investors have more options, they can buy a very small part instead of having to invest in each package of large value bonds in the traditional bond market.

Stock trading is similar. Even a lot of similar products and services on the financial market such as fund certificates, other valuable products can be exploited to become potential objects of Blockchain. And for these reasons, we can imagine how Blockchain technology will be applied in the capital market in the near future.

Currently NASDAQ, America's second largest electronic trading platform, has set up a Blockchain to trade stocks before the IPO. A series of banks around the world have applied Blockchain in bond transactions, with many big names such as HSBC, State Street (USA), LBBW (Germany), Commonwealth Bank (Australia) ...

Call community capital

Blockchain application in finance and business

Crowdfunding is also one of the Blockchain applications that have been created and developed flexibly thanks to the introduction of this new technology. Startups may no longer need centralized funding sites like Kickstarter or Indiegogo. With the Blockchain application, they can create crowdfunding platforms that have their own currencies and sell 'crypto shares' to original backers.

One of the first successful cryptocurrency crowdfunding platforms is the Swarm platform. The site is a business incubator, having launched its own currency, swarmcoin, to raise funds for startups in the cryptocurrency sector. 

Once in the hands of swarmcoin, investors have the right to receive dividends from businesses on their investment list. Within a few months of raising capital in 2014, Swarm fulfilled its $ 1 million goal for participating businesses.

Another interesting and exciting fund raising application can be listed as Lighthouse - a project that allows users to run community fundraising contracts or insurance contracts from bitcoin wallets, or bitflyer page to raise funds in Bitcoin in Japan. It was launched as a part of Fundflyer. 

In particular, the investment project in early 2018 promises to mark a new turning point for crowdfunding with Blockchain applications. This project is from Telegram - a famous messaging platform, aiming to raise capital up to US $ 3-5 billion in real money in 2018 through Telegram's own virtual currency issuance. 

Their idea is to launch an entirely new blockchain platform, using Telegram's 180 million existing users as a launch pad to make their virtual currency widely used and making Telegram the "king of cryptocurrencies" thanks to the regulation. tissue. If Telegram succeeds, the market for cryptocurrencies and blockchain-powered applications will surely be motivated to continue to boil over the years to come.

Application in production and business activities

Blockchain application in finance and business

Blockchain can be applied to improve labor productivity, improve management efficiency in companies, factories and improve production and business performance. 

For example, in the field of logistics, blockchain applications are being developed very strongly. The blockchain here is created as a kind of 'digital history', each movement of the goods will be divided into a block (a block) and the transactions are recorded every time the shipment is transferred to objects. different, forming a 'supply chain' with clear transaction history that cannot be changed or edited. 

This is very useful for monitoring the transport of goods as well as when verification is needed to trace the liability of the parties if there is a dispute or risk of future occurrence.

Blockchain can also be applied to track goods sourcing, traceability or even track the process from raw materials to consumption. This is not only beneficial for manufacturers but also for consumers. 

For manufacturers, the goods tracking application can help them know exactly the quantity and history of sales, inventory, and related data to plan the most accurate production and business. In contrast, consumers can also access information and origin of goods to better control the quality of products used. 

Other applications in economics and finance

In addition to the basic applications mentioned above that have been put into operation, many Blockchain applications are being identified, researched, or exploited initially throughout the financial economy.

These applications for individual users can be smart assets, loan documents, wills, trusts, fiduciary, physical keys for assets ... For objects of organizations and financial institutions Government or even on the scale of governments can be national digital currencies, payments, interbank loans, betting, transaction management, capital mobilization, other derivative tools ...

Taking the example of smart assets, just with this application, we can easily imagine how Blockchain applications can be further expanded and varied. Here Blockchain is used for all registration, inventory and exchange of all types of assets, tangible or intangible. That is, real-world assets such as houses, vehicles, stocks, patents, etc. are encrypted, registered on the blockchain, and anyone with a secret key will take ownership of those assets. 

The owner can resell the property by transferring this secret key to the buyer under a smart contract, or under a contract under the control of applicable laws. Thus, using blockchain alone in this way has been able to expand to many feature groups, many types of assets in different aspects of business finance.

The applications of Blockchain integrated with other technologies in the banking system around the world are also very diverse, which can be traditional applications such as interbank payments, B2B loans, B2C, control. risks, or new applications to prevent money laundering, asset security, against commercial fraud ... Because more than anyone else, financial institutions know best the breakthrough power of Blockchain as well as the image. How profound its impact on financial markets if not keep up with the new situation. 

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