It is estimated that out of the 7.6 billion global population, 2.5 billion people remained unbanked.
Blockchain was born out of an ethos to empower people and the activities required to conduct daily life. A vision of the future to make everyday life safer and more inclusive for all global citizens.
This relatively recent technological innovation has the potential to help the nearly 2 billion unbanked citizens of the world. Blockchain technology enables direct consumer engagement with those who cannot access traditional banking services. Direct, or peer-to-peer, financial services can happen while still guaranteeing the trust that central banks usually do through know your customer agreements.
Peer to peer is a new way of working together to create economic alternatives in an efficient, transparent, and scalable manner.
In a world that is starting to demand greater accountability from our custodians, blockchain can add a layer of transparency with better security. This dramatic financial shift should be viewed in a positive light for business growth with enhanced integrity and ethics.
Three basic principles of blockchain
- Tamperproof — every transaction stored on the blockchain is secured using a unique mathematical code (cryptography), and this virtual signature cannot be changed.
- Transparency — a single, public ledger that everybody can read, in which everybody can write, but nobody can alter.
- Trust — digital assets are not stored on a central database but distributed across a global ledger using the highest security. The ledger entry cannot be changed without the correct protocols, thereby creating virtual trust without a centralized platform.
Blockchain, in simple terms, is many copies of a computing database of recorded assets*. These copies are automatically synced through a set of centralized agreed rules and distributed on many computers, between parties who have pre-existing trust.
*Assets can be anything from currency to supply chain goods through to real estate records.
Several blockchain companies are working on interoperability between the myriad of blockchains. Like the Algorand Co-Chains initiative, these companies see the opportunity to develop and allow private ledgers to communicate without a traditional centralized intermediary. As with any technology, you must assess your own needs and pick a solution that fits for your needs.
The future state
Blockchain may be the future, but it will take a few more years for governments, enterprises, and the public to be comfortable with this financial change.
Regulators need time to be educated, understand this new technology, and adjust policies. Risks to work across borders and organizations need to happen from within the business community.
Nonetheless, with these enormous hurdles, it seems like 2020 will be a bold year for blockchain and the hope of a more inclusive financial future for all.
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According to a recent report, 71% of people have a mobile, but 30% of people have no bank account was originally published in Data Driven Investor on Medium, where people are continuing the conversation by highlighting and responding to this story.