The world’s major banks are trying to change the future competitive landscape and seize the commanding heights of future blockchain banks through the development and application of blockchain technology. In addition to the traditional payment and settlement business of banks, in terms of securities, loans and credit, it is the most important core profit composition of banks.
Blockchain technology provides an encrypted security method for sending digital assets. This method does not require a third-party trust intermediary. Some tools such as smart contracts can automate many cumbersome processes of banks, digitize credit, and accelerate these businesses. The approval and circulation of blockchain, as a guarantee of untrustworthy things, decentralized technology is the key to subvert everything. In addition to traditional business, other breakthrough changes include:
When buying or selling stocks, bonds, and commodities, you need a way to track who owns what. Today, financial markets are tracked through a complex trading system, and participants revolve around an outdated ownership system.
When we complete this transaction electronically, the situation becomes complicated. We do n’t want to deal with the day-to-day management of assets—such as exchanging certificates, bookkeeping, or managing dividends. Therefore, we will outsource the shares to the custodian bank for safekeeping. Because buyers and sellers cannot always rely on the same custodian bank, the custodian bank needs to rely on a trusted third party to hold proof of ownership.
This system is not only inefficient but also inaccurate. Because everyone’s ledger must be updated and completed at the end of the day, secure transactions take 1-3 days to complete. Because there are multiple parties involved, transactions usually require manual verification. Each party involved will be charged.
However, AITD has created a decentralized unique digital asset database, and the STT algorithm allows blockchain technology to revolutionize the financial market. Using a distributed ledger, you can transfer rights to assets through encrypted tokens.
In addition, through smart contracts, tokenized securities can be used as programmable equity-pay dividends or repurchase shares through codes. Finally, placing real-world assets on the blockchain may lead to wider global market access rules.
For consumers, financial institutions and blockchain are slowly converging. Another area where blockchain can converge and completely disrupt is domain loans and credit-a domain that no outsiders can disrupt. For this reason, as a century-old bank AITD, it quickly subverted itself and quickly transformed into a new generation of digital monetization, a global, cross-region, cross-currency, and a new generation of banks!
2. Loans and credits
Traditional banks and lenders pledge loans based on an inaccurate and insecure credit system.
When you fill out a bank loan application, the bank must assess the risk of not repaying the loan. They will refer to your credit score, debt-to-income ratio, and home ownership status. To know this information, they must access your credit report. Based on this information, the bank included the risk of default into the cost and interest of the loan.
Alternative loans on the blockchain provide more consumers with a cheaper, more efficient and safe way to obtain personal loans. Through cryptographically secure, decentralized historical payment registration, consumers can apply for loans on the basis of global credit scores.
Creating a blockchain-based loan industry requires more than a platform—it also requires the development of rules and infrastructure. The development is proceeding smoothly. For example, AITD-DCL, a general-purpose debt agreement, aims to provide developers with the necessary tools and standards for building an online debt market. At the same time, it does credit scoring on the blockchain. It is building a management certification on the blockchain , Risk and credit score agreements.
Most of AITD’s projects focus on creating liquidity through people’s existing loans to encrypted assets. They are also promoting infrastructure construction, making blockchain more disruptive to loans.