Forget cryptocurrencies. The behind-the-scenes online ledger for crypto transactions - blockchain - is now quietly driving a financial revolution.
In fact, research reveals more than three-quarters of the financial services industry plan to adopt blockchain by 2020 with Fintechs leading the way for this technology.
That's why we're particularly excited about our Blockchain as a Service (BaaS) product, which gives businesses a platform to run your blockchain network in an easily managed, stable and secure environment.
First, let's clarify what we mean by blockchain. Blockchain is a digital ledger where you can store any transactional data. While the majority of use cases have appeared in the financial services sector (including cryptocurrencies), blockchain could be used for any transaction, in any industry.
Blockchain distributes transactional data across various nodes, but it cannot be copied. Any unwarranted change alters the hash links and a mismatch will be detected between the nodes. This means that records on the blockchain cannot be tampered with or changed.
Blockchain provides Fintechs with a means to protect their online data - but with an added bonus. The decentralized nature of blockchain's peer-to-peer network technology removes costly and unnecessary processes and workflows. As a result, there is no need for multi-level hierarchies, record tampering is eliminated, and a consensus mechanism can take over entire transaction processes, which traditionally require three or four intermediate third parties.
This gives Fintechs advanced agility, allowing them to facilitate a wide range of financial transactions without any interaction with traditional financial bodies or other third parties.
Blockchain proponents claim this technology can substantially reduce cases of fraud and cyber-attacks in the financial landscape.
This is because, by giving Fintechs a decentralized network to share or transfer sensitive information, blockchain can curb data breaches and other such fraudulent activities, by making all concerned parties aware of such unscrupulous activity.
But is this enough? One report claims blockchains are now getting hacked. However, for the majority of these cases, this is because the solution was poorly executed, or unintentional software bugs left the system open to attack.
Fintechs deal with highly sensitive data and need to comply with a range of regulatory practices, depending on their solution. So, clearly, we need to address these security issues and find a robust solution. We cannot just rely on the assumption: 'if it's on the blockchain, it must be safe'.
Our BaaS solution is a highly secure system with a range of measures in place to help protect your blockchain. For example, BaaS incorporates our multi-tenant isolation strategies to prevent unauthorized access across tenants.
BaaS can also be integrated with our extensive suite of security solutions. These include chip encryption technologies, the creation of consortiums for due governance and the provision of the CA certificate service, which supports Chinese National cryptography algorithms and Intel SGX security technology.
In summary, the blockchain provides Fintech companies with the agility that they need to grow and one of the most secure means to store data, as long as you use a robust implementation like BaaS.
To learn more about how technology is impacting the financial services industry, download our ebook, Big Data and Blockchain: Innovative Fintech in the Cloud.
Alibaba Cloud Blockchain Service Team - January 17, 2020
Alibaba Clouder - September 28, 2020
Alibaba Clouder - January 4, 2021
Alibaba Clouder - June 24, 2020
Alibaba Clouder - July 26, 2021
Alibaba Clouder - May 20, 2020
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