Blockchain can create secure, efficient, tamper-proof records of sensitive activity. This is beneficial in the context of international payments and money transfers where high transaction fees, various intermediaries, and long settlement times are still the norm. The commercial bank Banco Santander launched the world’s first blockchain-based money transfer service in 2018. The so-called “Santander One Pay FX” customers can make same-day or next-day international money transfers. By using blockchain, Santander was able to reduce the number of intermediaries typically required in these transactions and lower the costs of transfers through less manual work required, making the process more efficient.
In capital markets, blockchain technology can contribute to faster clearing and settlement, the consolidation of audit trails and operational improvements (e.g., tokenizing stocks and less manual work, monitoring of richer data sets, market surveillance, fund portfolio management).
Traditionally, the common methods of trade financing involve slow processes which interrupt business and hamper liquidity. This is due to the fact that cross-border trade involves lots of data (i.e., country of origin, product details, documentation of transactions). Blockchain technology can automate this data tracking and monitoring.
Public Blockchain Networks
In accounting and auditing decreases the possibility of human error and the correctness of data. Account records cannot be changed once they are recorded on a chain.
Money Laundering Protection
Through the record-keeping on chain, supported by the “Know Your Customer (KYC),” process by which a business identifies and verifies the identities of its clients, coins, tokens and addresses that launder money or a suspected to do so can be blacklisted, leading to detection of fraudulent activities involving funds and business.
Blockchain in connection with smart contracts in insurance schemes has various application use cases. Moving insurance claims onto a blockchain can lead to the reduction of common sources of fraud in the industry (i.e., by rejecting multiple claims on one incident). There is also the possibility for medical records (or rather only the relevant parts) to be cryptographically secured and distributed between insurance companies, doctors and the patient. Another example would be filing a death claim whereby the manual process of filing claims is replaced with an automated blockchain system.
P2P payment services such as PayPal, Swish or Venmo offer fast and cheap transactions with e-money in many parts of the world, though some services restrict transactions based on location. Transaction fees, the risk of hacks and bankruptcies and the need for an intermediary can be reduced or eliminated by introducing a blockchain-based system.
To learn about industry use cases for blockchain application in the mobility sector, read the excursion paper “Analysis of Blockchain Technology in the Mobility Sector” by Prof. Dr. Philipp Sandner and Martin Gösele.