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With the advancement in technology, we encounter many such cases of fraud every day. As a result, fraud cases have skyrocketed over the years and have caused a huge dilemma that seems to have no boundary or limits. To counteract the problem, IT specialists have designed many ways to reduce the occurrence of these cases.
With reviewing the reports and the data gathered over the years, especially in European countries. Fraud cases have caused the major dialect in staggering the economy for about $193 billion per year. In contrast, it has been calculated up to a loss of $6000 per second each day.
Given that, one solution to these frauds is the formulation of Blockchain that contains a list of records using cryptography. Each block is linked to the next one with the hash that makes data transactions much more secure. However, the data is packed in blocks, and thus forming a chain will modify the security protocols.
Therefore, it won`t be easier for a hacker or a fraud to alternate the data once recorded in the blockchain. It can only be done by altering the whole chain retroactively with all subsequent blocks.
Functions of Blockchain Technology
Blockchain technology offers various security services. Therefore, it is said to offer integrity, transparency, and traceability, and above all, security. However, it is not enough to fuel the whole crypto asset with full encryption. Having said that, this technology has outdone the growth of cryptocurrency that became the reason for which money laundering has increased over the years.
Furthermore, this unique connection makes it impossible for any modification in the data. Therefore, for the international transaction of cryptocurrency, the data sometimes gets slow with cross-border payments.
Sometimes, there`s an issue that hinders the growth with the costly supply chain management, whereas BlockChain helps the users with its dynamic capabilities by increasing revenue.
You can form smart contracts with the clients and offer fast settlements with ensured transparency. Besides, it also protects the crypt asset by validating privacy tracking and decentralized copyrights. Furthermore, it offers liquidity by promoting fair business and selling processes.
The Importance of KYC process (Your Customer or Know Your Client)
Blockchain goes a long way to secure and solve the upcoming problems of fraud. However, it can only be effective in the crypto asset space with a KYC (Know Your Customer) program. Meanwhile, this process has been in place within an entirely regulated environment.
It has also been said that BlockChain technology can transform Complex Client Onboarding. It also transformed the compliance process into simpler and proved a successful and effective solution to your businesses.
Yotam Namir, the founder of Tech View, a compliance company, the digital and blockchain service, spoke of the importance of the KYC process in the prevention of fraud in the blockchain environment.
“Blockchain goes a long way to help solve the growing problem of fraud but for that can only be truly affected in the crypto asset space with a KYC ( Know Your Customer) process in place within a universally regulated environment.”
We recommend visit https://www.techview.world/ to get more details about KYC.
Resolving Complete Compliance Process
Getting in-depth knowledge of how the Blockchain works depends upon its functions, for which it is capable of offering multiple tasks with a single go. In addition, it also helps in streamlining the whole process by cutting out the third-party source to make the data much more secure.
Thus, by using this sophisticated and secure ledger, the payment, when recorded, gets directly to the receiving party without any further delay. That is why, when you want to get instantly paid, instead of waiting for an extensive duration of time, BlockChain is surely an effective technology to be used that completes the entire transaction within a matter of seconds.
Moreover, since all the data can easily be tracked in real-time, it reduces the risks of misplacement by securing them in the blocks or for the goods that sometimes get stuck while streaming.
Having said that, this innovative technology comes with its dynamics at unimaginable levels. That makes the business grow the easiest way by managing the supply chain demand effortlessly.
Eliminating Fraud in Various Domains
You all must be wondering how does it incorporate securing the data. Generally, Blockchain is a sort of shared ledger where verified contributors can share digital information, view and store in a more centralized and secure environment.
This will help in the future by fostering trust, transparency, and accountability to flourish and nurture their clientele and business relationships.
1. Prevention of fraud in Finance Department
As multiple transactions are made daily and with that arises many complications. However, the financial transaction requires multistep face-to-face interaction processes and is a source, basic platform for the fraudsters.
Blockchain plays a major part in reducing this issue with timeless and effortless transactions. With the lesser time, it is less likely that a third party could interfere and cause trouble with the transaction, thus making the process transparent and secure.
2. Prevention of Fraud in the Supply Chain Domain
Supply chains, when operated manually, imply a greater risk of fraud. This involves complex, undetected commitments that can lead to major issues. However, with the advancement in technology, blockchain offers its services to reduce such hazards.
It improves the transparency in transactions and, along with that, the traceability of goods. Furthermore, given the features of blockchain, it is nearly impossible for someone with fraud intentions to manipulate the data due to the storage of every single record.
Moreover, it is difficult to deploy the streamline of the blockchain, which is an absolute record that can only be restructured and authenticated through consensus among various network contributors. However, if a product is digitized and shared on the blockchain, it can be easily traced to its origin due to the stored information upon the distributed ledger.
Does BlockChain Eliminate all the risks of Fraud?
Every technology has its drawbacks, so obviously, certain factors could still be a risk for fraud. However, even with the implications of security protocols, thefts will still find a way to intervene, while blockchain networks are constructed upon the notion of a decentralized controller program.
However, the infrastructure can still leave back doors open or the loopholes to the vulnerabilities that will allow tampering and unauthorized access for the third party. For that reason, enterprises and businesses need to set a blockchain design specifically modulated for the business purpose that will serve them right in the prevention of fraud.
Thank you for reading!