Blockchain Technology in Financial Markets: Disrupting Traditional Banking Systems

Abstract

Blockchain is gradually finding its way into the financial industry and seems to be a potential solution to traditional banking problems. Specifically, through real-time transactions, increasing the level of openness and reducing the costs of work, blockchain can revolutionize the financial market worldwide. This empirical study aims at exploring the disruptive nature of blockchain with reference to cross border payments, smart contracts and fraud. This research employs secondary research techniques together with critical models like Distributed Ledger Analysis and Cost-Benefit Analysis to establish the efficiency and possibilities of the blockchain than the conventional systems. The results reveal that even though blockchain has certain benefits in terms of efficiency and decentralisation, such issues as the system’s capacity, its power consumption, and legal ambiguity exist. For future research, the current study’s limitations should be considered while future studies should also look at the effects of the technology beyond the current advanced economies and emerging economies.