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Ethereum for banks

Beyond applications in banking, dapps have the potential to play many different roles in fintech. Vega Fund, for example, a decentralized managed fund, recently published their vision for many ways in which the platform might be used, from crowdfunding to inter-community trading.

Other fintech projects currently under development using Ethereum include: A decentralized hedge fund platform and social trading CryptoFund: Cryptocurrency asset management hedge fund SmartToken: Smart contract powered Visa debit card Community-Currency: Community currency with zero reserve mutual credit. Ethereum is far from being mainstream, to be sure. But the key takeaway for fintech is that blockchain technology, Ethereum included, will drastically lower the cost of deploying new financial concepts, lowering barriers to entry and encouraging innovative solutions to the problems in financial services.

A nonpartisan comparison of two of the most prominent cryptocurrencies. This thus requires two currency exchanges e. At the same time, using cryptocurrencies makes it possible to cut out certain fees and waiting times associated with the use of correspondent banks by conventional providers such as Western Union. In addition to these cost savings, blockchain-based money-transfer operators can leverage synergies by trading on a proprietary basis in cryptocurrencies in addition to their core business.

This is how, for example, start-ups Circle and Cashaa can offer money transfers free of charge or at very low cost in several countries. It remains to be seen whether these companies will be able to establish themselves on the market in the long term. However, it already seems conceivable that blockchain technology will be able to help reduce remittance costs in the next few years by removing the need for correspondent banks.

Blockchain technology holds great potential for increasing structural efficiency in many areas of business and administration. This is especially true for areas in which trust between market players has previously been based on the involvement of a central authority.

Remittances can be effected relatively easily using existing blockchain technology. As such, there are already solutions available that offer cost advantages over established money transfer operators. However, it will most likely be a few more years until blockchain-based networks can operate as fully-fledged banks offering user-friendly payment services, savings accounts and micro loans to financially underserved individuals.

Actors in the public and private sectors should support this process by actively leveraging the potential of blockchain technology and promoting its further development. The first step in this direction could be to accept cryptocurrencies for certain payments. The Swiss canton of Zug, for instance, joined the ranks of numerous companies in when it began accepting payments for municipal services in bitcoin.

Further experts Berensmann, Kathrin Economist. Burchi, Francesco Development Economist. Schiller, Armin von Political Scientist. Access to environmental information: