The application of blockchain technology in the banking sector has already proven to be infinite. The cryptocurrency’s underlying decentralized technology is in the process of disrupting the status quo maintained by the sector for a long time now. It has minimized, if not eliminated the prevailing security issues with financial transactions
While other viable implementations of the technology are being explored, the technology has coming up as a reliable technology to solving an array of cybersecurity challenges to banking institutions. Blockchain being (as far as we know) incorruptible, poses several advantages over other systems but still has a few challenges in terms of compliance, regulations, and enforcement. One example of the application of blockchain technology in the banking sector is processing of private equity transactions using leverage buyouts financed with debt.
By moving all banking operations to the blockchain, we can eliminate the need for trusted intermediaries whose externalities have weighed negatively on global trade. For instance, CommerceBlock, a blockchain based fintech company, will be the first technology platform to provide a combination of trusted minimal trade, decentralized contract execution, on-chain derivatives, and asset-backed token issuance to the public blockchain. CommerceBlock, with its ICO currently underway is a public blockchain infrastructure company with a platform that allows anyone to build and use financial products and services historically reserved for commercial banking customers.
CommerceBlock will offer a number of tools that enable anyone to build and use services that construct contracts, manage trade flows, issue assets, hedge currency risk, and engage in multiparty dispute resolutions. The use of blockchain technology protects the network from censorship, seizure, failure, hacking, monopolistic pricing, and other externalities. Both the developers and end users will be able to manage all stages of the business interaction and fulfill their contractual obligations by utilizing the CommerceBlock platform. The protocol behind the CommerceBlock platform is designed in a way that business logic, customer funds, and trade details, are managed on the client’s side, meaning CommerceBlock has no access to both customer funds and private information.
Since leaving Merrill Lynch and JP Morgan, Nicholas Gregory, the CEO, and Founder of CommerceBlock, has been involved in the cryptocurrency industry since 2015 and took an early interest in Bitcoin in 2012. During his time in the banking sector, Nicholas witnessed first-hand the inner workings of major financial institutions. Nicholas observed the high demand for cryptocurrency-based commercial banking products. So, Nicholas set out to work on a new Fintech company that would replicate the products of a commercial bank but leaving out the centralized organizational structure in favor of decentralization, which has now turned into the CommerceBlock Network.