Monetary exchange is fundamental to the way the world works. There has to be a system to allow transactions to occur between people who do not have a direct method of exchange. It all works out if, for example, someone who wants a chicken can repair a roof for someone who has a chicken but, if the 2 scenarios don’t happen to meet up, a symbolic system of transaction has to take over. That’s where money comes in. This simple concept still basically underpins the financial systems we see today, albeit with much more complex transactions taking place.
This helps to explain why any change in financial systems can be seen as genuinely revolutionary. Massive institutions have enjoyed the status quo for literally hundreds of years, which theoretically creates a stable system but one that lacks innovation and, therefore, options. Anything that circumnavigates the institutions has the power to change the financial landscape and that’s where blockchain comes in.
Fintech Reviews – what is blockchain?
Blockchain is type of decentralized database that allows complete visibility of the entire history of a transaction. Its use is not limited to the financial world but it has found many applications there. Probably the most famous one of these is Bitcoin.
Blockchain allows peer-to-peer transactions to take place so people do not have to use an intermediary. They are still able to enjoy security and accountability, which used to be something only established institutions could offer people. In fact, it offers a greater amount of security in today’s world because blockchain is not vulnerable to hacking in the same way as centralised businesses.
Fintech reviews – what’s the potential of blockchain?
Any aspect of life that requires a transaction could, theoretically, be conducted through blockchain without handing off the details of the exchange to a third party. Intermediaries could be a thing of the past, making it much harder for massive global conglomerates to retain control and exert influence. It’s hard to imagine the scope of the impact on the world scene in every arena from politics to socio-economics. The financial world is already feeling the impact and things are only just getting started.