- Global fintech blockchain market expected to grow by US$8.7 billion in 7 years
- Blockchain solutions could save up to US$9 billion in fraud losses
Fintech blockchain combinations are emerging as the most promising technology mix, with the global market for said fintech blockchain solutions on track to reach a value of US$8.7 billion by 2026.
Blockchain technologies are continuing to transform the fintech industry, through the transparency and protection against fraud that is inherently provided by the decentralized nature of blockchain technology itself.
With the continued transformation comes the continued growth of the market for solutions, platforms, and technologies, and the global market for fintech blockchain is expected to reach a value of US$8.7 billion by 2026. For context, said global market was already valued at about US$1 billion back in 2020.
As it stands, end-use financial services already make up about a third of the blockchain market in Europe in 2020, utilizing blockchain’s capability for secure transactions to manage financial transactions.
Fintech blockchain in use
The proposed deployment of central bank digital currencies is an area where blockchain meets fintech for greater security in transactions. With Visa and Mastercard both providing platforms to test central bank digital currencies, a case can be made that central banks are showing a growing interest in new financial technologies and how they might enhance the stability, resiliency, and efficiency of financial systems.
Retail banks actually stand to gain from incorporating blockchain into their fintech offerings as well, with a report pointing out that blockchain-based solutions could reduce annual losses from fraud by between US$7 billion to US$9 billion.
An example is how Bluzelle, a blockchain-based data storage start-up, worked with a consortium of three banks in Singapore in 2017 to test a platform for Know-Your-Customer (KYC) authentication. This particular project showed that a blockchain platform would not only improve efficiency but would also cut the risk of financial crime and heighten responsiveness to performance and scheduling needs. It was also predicted to reduce costs by 25 to 50 percent.
This could be the precursor to immutable digital identities, where not only does the institution know the customer, the customer knows the institution as well, with identities that are secure on both parties further minimizing the risk of identity theft or financial loss.
3 February 2023
3 February 2023