Blockchain and the cashless society

Blockchain and the cashless society

Chris Trew

CEO at Stratis

Views 1728

Blockchain and the cashless society

17.09.2019 12:45 pm

It took 200 years before the invention of the printing press heralded the widespread use of modern banknotes. Four centuries on and blockchain technology – still barely a decade old – is moving so rapidly that the days of cash are surely numbered.

The way we use money has been revolutionised by plastic cards, online banking, contactless and smartphone payments. The next big development will see blockchain turn the concept of a cashless society from science fiction to reality.

Some countries, such as Sweden, are already going down the cashless route using existing technology. But these systems are still relatively slow, vulnerable to fraud and depend on banks and other financial institutions to acts as intermediaries.

Blockchain enables rapid transactions on a distributed ledger, a digital record stored on a network of computers around the world. It also provides a high level of security against fraudsters and makes transactions quicker and cheaper by removing the need for intermediaries.

It supports cryptocurrencies, or digital money, such as Bitcoin and alternatives known as altcoins. It also supports crypto tokens which are used on existing blockchains as a method of payment, to give holders access to goods and services or a share of a business.

For instance, blockchain could be used by workers to send wages to their family in their home country. Tokens could be sent in seconds. Such remittances can take place securely, with no middlemen and lower costs.

There are now many cryptocurrencies in use in addition to bitcoin. The sector is evolving rapidly and as they become more widely accepted it is inevitable they will be adopted by businesses of all types.

One of the elements that makes blockchain so revolutionary is that it supports not just the cryptocurrency and payment system but the whole transaction process through smart contracts. As a digital ledger that cannot be altered, it provides users with traceability and security without the need for middlemen.

Its use will span retailing, manufacturing, distribution, financial services, property, gaming, and healthcare.

Even central banks that issue notes can see the way the wind is blowing and an increasing number are developing their own central bank digital currencies (CBDCs) using blockchain.

It has another big advantage because it can be used for micropayments of a few pence or cents, such as paying to listen to a piece of music, watch a video or read an article.

This has huge implications for the Internet of Things (IoT) where devices are linked via the web, from household appliances to smartwatches and from sensors in buildings to robots on production lines. Blockchain will seamlessly host the contract between provider and customer as well as payment.

Blockchain also heralds a revolution for the two billion-plus people without bank accounts by giving them access to digital financial services from which they are currently excluded. For a close parallel, see how mobile phones have transformed communications and financial services.

For individuals, businesses, financial institutions and central banks, there is a now a rapidly growing momentum pulling us away from a centuries-old system based on banknotes to one built on blockchain.

Latest blogs

Alex Kreger UXDA

How Customer Centricity Dictates the Business Success in the Digital Age

There are two different approaches to gain business success. One worked in the recent past and the other works in the digital present. Marketing age In the recent past, FMCG (Fast-Moving Consumer Goods) products dominated the market and determined Read more »

Carlos Figueredo Open Vector

Open Banking - An Opportunity for UK Banks

The appearance of open banking created an immediate concern within the banks as they would now have to share customer data, competition from challenger banks, etc. Even though it is a well-known statement these days that “innovation will come with Read more »

Andrew Davies Fiserv

New decade, new threats: How financial institutions can fight financial crime

Financial crime is becoming increasingly sophisticated as new threats emerge and evolve at a rapid pace. As the new decade begins, both criminals and financial institutions are prepared to take the offensive, leveraging know-how and technology in a Read more »

Paul Marcantonio ECOMMPAY

5 Steps to Set Up Online Payments for Your Business

Selling things online can be complicated. There are web shops to design, product descriptions to create, and payment methods to set up. The latter is probably the single most important part of the process - for a very simple reason. If your Read more »

Carlo R.W. de Meijer MIFSA

Crypto Regulation in the Western World: Towards More Global Uniformity?

In my last Blog I suggested that regulation of the crypto markets would be one of the main issues for 2020 and beyond. There seem to be urgent need for more clarity on many cryptocurrency issues. The EU Fifth ALM Directive came into effect early Read more »

Related Blogs

Georgios Dimitropoulos College of Law at Hamad Bin Khalifa University

Cryptocurrency and Blockchain Regulation between Citizen Protection and Innovation

Cryptocurrencies first made their appearance on the Internet and in the global financial markets during the global financial crisis of 2008. Cryptocurrencies have virtual monetary value and rely on peer-to-peer cryptographic technology for the Read more »

Olena Petrashchuk 4ire Labs

The Role of Blockchain Transforming Green Investments

Green investments are to be considered the good ones. The activity of investors involved in green projects is overwhelming. The new platform “Green Asset Wallet” powered by Blockchain launched to give the confidence to regular investors while Read more »

Nish Kotecha and Bryan Foss Independent Director and Visiting Professor Finboot , Bristol Business School

How blockchain could restore trust to the fund management and audit industries

Not too long ago, Neil Woodford was still regularly being heralded as a “superstar” manager and the “Oracle of Oxford”. How different the story is today.  The reasons behind Woodford’s fall from grace have been extensively covered, but can largely Read more »

Michelle Joe blogger

The Most Interesting Real-world Applications of Blockchain Technology

Blockchain is changing the mindset of businesses and governments as we know it. Blockchain has been identified as the next big thing since the internet. It is producing innovative models that are disrupting traditional ones. The momentum created Read more »

Nish Kotecha Finboot

Blockchain’s role in energy supply chains and the fight against climate change

Two topics dominated September’s UN General Assembly, at times provoking fiery debate. World leaders gathered in New York amid simmering tensions in the Middle East. The recent attacks on key Saudi Arabian oil facilities prompted questions about how Read more »

Magazine
ALL
Free Newsletter Sign-up
+44 (0) 208 819 32 53 +44 (0) 173 261 71 47
Download Our Mobile App
Financial It Youtube channel