Blockchain: How blockchain technology is changing the security landscape in the banking sector - The Economic Times

Blockchain: How blockchain technology is changing the security landscape in the banking sector – The Economic Times

Quite interestingly, the merits of blockchain technology are not limited to securing digital transactions alone.

Blockchain, the technology that is used in the popular cryptocurrency ‘Bitcoin’, is revolutionary in many ways. It addresses multiple challenges associated with digital transactions, such as double spending and currency reproduction. Employing blockchain also reduces the cost of online transactions while simultaneously increasing authenticity and security. The upshot is that the need for payment processors, custodians, and reconciliation bodies is eliminated.

These benefits are amongst the prime reasons why the technology is being extensively deployed within the banking sector.

But, quite interestingly, the merits of blockchain technology are not limited to securing digital transactions alone. The IT infrastructure that is used to process digital transactions also benefits immensely from blockchain deployment, which offers multiple cybersecurity advantages to banking applications. Here’s a look at how this happens:

A blockchain is a series of blocks that records data (financial, in this case) in hash functions with timestamp and the link to the previous block. These blocks are anonymously stored with other stakeholders within a network. This eliminates centralised points of vulnerability which cybercriminals can exploit. Moreover, previous blocks cannot be overwritten in a blockchain and all transactional data is verified with every relevant stakeholder, making data manipulation is extremely impracticable.

Source/More: Blockchain: How blockchain technology is changing the security landscape in the banking sector – The Economic Times