The blockchain may become a secure system for international transfers of everything from cash to securities and other financial contracts. Blockchain expert Alexander Bottema, everyday IT consultant at Mathworks, lists six reasons to blockchain will redraw the entire international financial market.
International transactions become fast and cheap
In Sweden, it is fast to send money from one bank to another. Everyone knows that banks used the mobile app Swish. The backbone of these transactions is the Riksbank's RIX payment system that forms the central hub of the Swedish financial infrastructure. Even within Europe, it is relatively inexpensive to send money, although it often takes a day for the money to go forward.
But when a private individual transfers money to the rest of the world – it is both expensive and slow. Anyone who wants to send a few hundred dollars to the United States must, for example, to reckon with solid fees and several days of waiting. The reason is a system with many intermediaries and large, antiquated computer systems that are expensive to replace.
With blockchain all these problems can be solved quickly. The person sending the money to the United States still have to pay a conversion fee. But then the transmission will take just a few minutes.
"Banks can use the blockchain of international currency transactions. They must still switch e.g. crowns into dollars through a currency exchange. But the transfer does not take more than ten minutes. During this short time it is possible to exchange their dollars to bitcoin, " - explains Alexander Bottema.
The transactions are safe
Miscellaneous Bitcoin thefts has led many to see the virtual currency as a security risk. Bitcoin rate has also some turbulent periods. However, according to experts, there is no safer than a transfer via the blockchain system. "Blockchain is a technology that makes history free of any manipulations. All computers in the system monitor each other. They ensure that all transactions are packed into blocks and verified, "said Alexander Bottema.
"Computers in the system" thing refer to all the computers that "manage" bitcoin ( i.e. rewards with new bitcoin for its administrative data) as well as all commercial entities that are nodes in the network.