UNIT II

Distributed ledger technology (DLT) is a digital system for recording the transaction of
assets in which the transactions and their details are recorded in multiple places at the same
time. A distributed ledger is a type of database that is shared, replicated, and synchronized
among the members of a decentralized network. The distributed ledger records the
transactions, such as the exchange of assets or data, among the participants in the network.

Blockchain is a well-known example of a distributed ledger technology.

BLOCK-CHAIN

The basic application of the blockchain is to perform transactions in a secure network A

blockchain can be used for the secure transfer of money, property, contracts, etc. without
requiring a third-party intermediary like bank or government. Blockchain is a software
protocol, but it could not be run without the Internet (like SMTP used in email). A blockchain
is a chain of blocks which contain information. Each block records all of the recent
transactions, and once completed goes into the blockchain as a permanent database. Each
time a block gets completed, a new block is generated.

Blockchain defined: Blockchain is a shared, immutable ledger that facilitates the process of
recording transactions and tracking assets in a business network. An asset can be tangible (a
house, car, cash, land) or intangible (intellectual property, patents, copyrights, branding).
Virtually anything of value can be tracked and traded on a blockchain network, reducing risk
and cutting costs for all involved.

The above definition clearly explain the following:

Ledger: It is a file that is constantly growing.

Permanent: It means once the transaction goes inside a blockchain, it permanently in the
ledger.

Secure: Blockchain placed information in a secure way. It uses very advanced cryptography
to make sure that the information is locked inside the blockchain.

Chronological: Chronological means every transaction happens after the previous one.

Immutable: All the transaction onto the blockchain, this ledger can never be changed.

List of Banks Using Blockchain Technology in India

The list of banks using Blockchain technology in India is divided into private and
public:

Private Banks Using Blockchain Technology

• IndusInd Bank
• Yes Bank

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 • RBL Bank
• IDFC Bank
• South Indian Bank
• Federal Bank
• HDFC Bank
• ICICI Bank
• Kotak Mahindra Bank
• Axis Bank

Public Banks Using Blockchain Technology

• Bank of Baroda
• Indian Bank
• SBI
• Canara Bank

Real life application of blockchain :

Here is a list of real world problem where we can use blockchain :

In a secure and full-proof voting management system.

To supply chain management.
In healthcare management.
Real estate project.
NFT marketplace.
Avoid copyright and original content creation.
In the personal identity system
To make an immutable data backup.
Internet of Things

Structure of block chain

The structure in a blockchain includes these elements

1. Blocks: A blockchain consists of a series of blocks, each containing a list of

transactions or other data. Blocks are linked together in a chronological order,
forming a chain. Each block typically includes a unique identifier (hash), a timestamp,
and a reference to the previous block's hash, creating a continuous and immutable
record of transactions. We can store data in blocks permanently but cannot change or
delete it after it is stored. Once a block is filled with the data of transactions, then it
will be linked with previous blocks. The blocks are linked based on cryptographic
methodology.

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2. Transactions: Transactions represent the data or information that is recorded on the
blockchain. These can include financial transactions, contracts, or any other form of
digital interaction. Transactions are grouped into blocks and stored on the blockchain
after being validated by network participants.
3. Distributed Network: Blockchain operates on a decentralized network of computers,
often referred to as nodes or peers. These nodes participate in maintaining and
validating the blockchain by performing tasks such as transaction verification, block
creation, and consensus protocols. Each node has a copy of the entire blockchain,
ensuring redundancy and data integrity.
4. Consensus Mechanism: To maintain the integrity and consistency of the blockchain,
a consensus mechanism is employed. This mechanism ensures that all nodes in the
network agree on the validity of transactions and the order in which they are added to
the blockchain. Examples of consensus mechanisms include Proof of Work (PoW),
Proof of Stake (PoS), and Practical Byzantine Fault Tolerance (PBFT).
5. Cryptographic Hashing: Cryptographic hashing algorithms are used to create unique
identifiers (hashes) for each block in the blockchain. These hashes are generated by
applying complex mathematical calculations to the block's data. The hash of each
block is stored in the subsequent block, creating a chain that ensures the immutability
of the blockchain.
6. Peer-to-Peer Communication: Nodes in a blockchain network communicate with
each other using a peer-to-peer (P2P) network protocol. This allows for the exchange
of data, sharing of transaction information, and propagation of blocks across the
network. P2P communication ensures that no central authority is required to control
or verify transactions, making the network more resilient and decentralized.
7. Smart Contracts (Optional): Some blockchains support the execution of smart
contracts. Smart contracts are self-executing contracts with predefined rules and
conditions encoded within the blockchain. They automatically execute transactions or
trigger actions based on predetermined criteria, removing the need for intermediaries
and enhancing automation within the blockchain.
8. Public or Private Blockchain: Blockchains can be public, allowing anyone to
participate and access the blockchain, or private, restricting access to a select group of
participants. Public blockchains, like Bitcoin and Ethereum, are open and transparent,
while private blockchains are often used by organizations to facilitate internal
processes, consortiums, or industry-specific applications.
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9. Hash Codes: It is one of the vital security features used in blockchain technology. In
its basic form, a hash code has a fixed length. It helps to ensure that no one can crack
blockchains or alter block data. We can use Hash codes to verify the integrity of
transactions as well as authentication. We can add new blocks only after solving hash
codes. Note that it must generate the same output whenever we apply the hash
function in data in a block. If not, it means that the data in the block is modified.
10. Nodes: It is one of the essential components of blockchains. Nodes are storage units
that store vast amounts of blockchain data. Nodes can be computers, servers, and
laptops. All nodes are connected in a blockchain network. If any change is made in
the blockchain's data, nodes can detect it quickly. There are two types of nodes such
as full nodes and light nodes.
a) Full Nodes: Generally, a full node stores the complete copy of a blockchain. In
other words, once a full node joins a blockchain, it stores copies of all the blocks.
After the node is synchronized with all other nodes in the network, it can add new
blocks to the blockchain. Full nodes usually have more memory than light nodes.
They can accept, reject, and validate transactions.
b) Light Nodes: They are also known as partial nodes. This is because they don't
copy all the blocks in the blockchain. Instead, they only store the recent blocks
and access older ones only when users request the same. They maintain the hash
code of transactions. You can access data only after solving the hash code. Unlike
full nodes, they have only low computing power and memory.
11. Ledger: Essentially, this component of a blockchain resembles a record-keeping
mechanism. There are three types of ledgers: public, decentralized and distributed.
a) Public Ledger: In this type, anyone can access ledgers since it is open to all
blockchain network participants. There is no central authority in this public ledger
type. And it allows transactions only after verifying the identity of users. At the same
time, participants' identities are hidden until they make any transaction.
b) Distributed Ledger: In distributed type, all the nodes will have a copy of databases.
A group of nodes will manage the tasks, such as verifying transactions or adding
blocks to a blockchain. You can significantly reduce financial fraud and cyber attacks
by using this ledger. You can access all the information stored in this ledger using
cryptographic signatures and keys.
c) Decentralized Ledger: In this type, no participant needs to trust others or know their
identities. The stakeholders or partners can access real-time data from the ledgers
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 anytime. This ledger lessens reliance on specific authorities that manage the network.
It brings consistency and improves performance by decentralizing resources.

12. Nonce: Nonce is yet another vital component of blockchain. It refers to a ‘Number
used only once. In its basic form, a nonce is a 32-bit number randomly used only
once. It is also a pseudo-random number that you can use only once in a
cryptographic communication. Generally, a nonce is created only once while creating
a new block or validating a new transaction. Once a perfect nonce is created, we can
add it with the hashed blocks in a blockchain. After that, the block's hash value is
rehashed, eventually creating a difficult algorithm. With this component of
blockchain, we can make secured transactions because nonce verifies all the
transactions along with other data of blocks.

Types of Blockchain
There are 4 types of blockchain:
• Public Blockchain.
• Private Blockchain.
• Hybrid Blockchain.
• Consortium Blockchain.

1. Public Blockchain
These blockchains are completely open to following the idea of decentralization. They
don’t have any restrictions, anyone having a computer and internet can participate in the
network.
• As the name is public this blockchain is open to the public, which means it is not owned
by anyone.
• Anyone having internet and a computer with good hardware can participate in this
public blockchain.
• All the computer in the network hold the copy of other nodes or block present in the
network

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• In this public blockchain, we can also perform verification of transactions or records.
Examples of public blockchain are Bitcoin, Ethereum.
Use Cases:

Voting: Governments can do voting through public blockchain employing transparency and
trust.

Fund raising: Companies or initiatives can make use of the public blockchain for
improving transparency and trust.

Advantages:
• Trustable: Anyone can join the public blockchain. It brings trust among the whole
community of users
• Secure: This blockchain is large in size as it is open to the public. In a large size, there
is greater distribution of records
• Anonymous Nature: It is a secure platform to make your transaction properly at the
same time, you are not required to reveal your name and identity in order to participate.
• Decentralized: There is no single platform that maintains the network, instead
every user has a copy of the ledger.
• No Intermediaries: Public blockchain requires no intermediaries to work.
• Transparency: It brings transparency to the whole network as the available data is
available for verification purposes.

Disadvantages:
• Processing: The rate of the transaction process is very slow, due to its large size.
Verification of each node is a very time-consuming process.
• Energy Consumption: Proof of work is high energy-consuming. It requires good
computer hardware to participate in the network
• Acceptance: No central authority is there so governments are facing the issue to
implement the technology faster.
• Lack of transaction speed: They suffer from a lack of transaction speed. It can take a
few minutes to hours before a transaction is completed. For instance, bitcoin can only
manage seven transactions per second compared to 24,000 transactions per second done
by VISA.
• Scalability : Another problem with public blockchain is scalability. They simply cannot
scale due to how they work.

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2. Private Blockchain
A private blockchain is one of the different types of blockchain technology. A private
blockchain can be defined as the blockchain that works in a restrictive environment, i.e., a
closed network. It is also a permissioned blockchain that is under the control of an entity.
• These are not as open as a public blockchain.
• They are open to some authorized users only.
• These blockchains are operated in a closed network.
• In this few people are allowed to participate in a network within a
company/organization.

Examples of Private blockchain: Multichain, Hyperledger Fabric, Hyperledger Sawtooth,

Corda

Use Cases: With proper security and maintenance, companies use them for internal
auditing, voting, and asset management.
Supply chain management: Organizations can deploy a private blockchain to manage
their supply chain. Asset ownership: Assets can be tracked and verified using a private
blockchain. Internal Voting.

Advantages:
• Speed: Private blockchains are fast. This is because there are few participants compared

to the public blockchain.

• Scalability: We can modify the scalability. The size of the network can be decided
manually.
• Privacy: It has increased the level of privacy for confidentiality reasons as the
businesses required.
• Balanced: It is more balanced as only some user has the access to the transaction which
improves the performance of the network.
Disadvantages:
• Security: The number of nodes in this type is limited so chances of manipulation are

there. These blockchains are more vulnerable.

• Centralized: Trust building is one of the main disadvantages due to its central nature.
Organizations can use this for malpractices.
• Count: Since there are few nodes if nodes go offline the entire system of blockchain
can be endangered.
3. Hybrid Blockchain
It is the mixed content of the private and public blockchain, where some part is
controlled by some organization and other makes are made visible as a public blockchain.

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• It is a combination of both public and private blockchain.
• Permission-based and permissionless systems are used.
• User access information via smart contracts
• Even a primary entity owns a hybrid blockchain it cannot alter the transaction

Use Case: It provides a greater solution to the health care industry, government, real estate,
and financial companies. It provides a remedy where data is to be accessed publicly but
needs to be shielded privately. Examples of Hybrid Blockchain are Ripple network and
XRP token.

Advantages:
• Ecosystem: Most advantageous thing about this blockchain is its hybrid nature. It

cannot be hacked as 51% of users don’t have access to the network

• Cost: Transactions are cheap as only a few nodes verify the transaction. All the nodes
don’t carry the verification hence less computational cost.
• Architecture: It is highly customizable and still maintains integrity, security, and
transparency.
• Operations: It can choose the participants in the blockchain and decide which
transaction can be made public.

Disadvantages:
• Efficiency: Not everyone is in the position to implement a hybrid Blockchain. The

organization also faces some difficulty in terms of efficiency in maintenance.

• Transparency: There is a possibility that someone can hide information from the user.
If someone wants to get access through a hybrid blockchain it depends on the
organization whether they will give or not.
• Ecosystem: Due to its closed ecosystem this blockchain lacks the incentives for
network participation.
4. Consortium Blockchain
It is a creative approach that solves the needs of the organization. This blockchain
validates the transaction and also initiates or receives transactions.
• Also known as Federated Blockchain.
• This is an innovative method to solve the organization’s needs.
• Some part is public and some part is private.
• In this type, more than one organization manages the blockchain.

Examples of Consortium Blockchain: Marco Polo, Energy Web Foundation, IBM Food
Trust.

Use Cases:
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Banking and payments: A group of banks can work together and create a consortium.
Research: A consortium blockchain can be used to share research data and results.

Food tracking: It is also great for food tracking.

Advantages:
• Speed: A limited number of users make verification fast. The high speed makes this

more usable for organizations.

• Authority: Multiple organizations can take part and make it decentralized at every
level. Decentralized authority, makes it more secure.
• Privacy: The information of the checked blocks is unknown to the public view. but any
member belonging to the blockchain can access it.
• Flexible: There is much divergence in the flexibility of the blockchain. Since it is not a
very large decision can be taken faster.

Disadvantages:
• Approval: All the members approve the protocol making it less flexible. Since one or

more organizations are involved there can be differences in the vision of interest.
Transparency: It is less transparent.
• Vulnerability: If few nodes are getting compromised there is a greater chance of
vulnerability in this blockchain

TYPES OF DLT:
1. Blockchain: In this type of DLT, transactions are stored in the form chain of blocks and
each block produces a unique hash that can be used as proof of valid transactions. Each
node has a copy of the ledger which makes it more transparent.
2. Directed Acyclic Graphs (DAG): This uses a different data structure to organize the
data that brings more consensus. In this type of DLT, validation of transactions mostly
requires the majority of support from the nodes in the network. Every node on the
network has to provide proof of transactions on the ledger and then can initiate
transactions. In this nodes have to verify at least two of the previous transactions on the
ledger to confirm their transaction.
3. Hashgraph: In this type of DLT, records are stored in the form of a directed acyclic
graph. It uses a different consensus mechanism, using virtual voting as the form
consensus mechanism for gaining network consensus. Hence nodes do not have to
validate each transaction on the network.

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4. Holochain: Holochain is termed as the next level of blockchain by some people because
it is much more decentralized than blockchain. It is a type of DLT that simply proposes
that each node will run on a chain of its own. Therefore nodes or miners have the
freedom to operate autonomously. It basically moves to the agent-centric structure. Here
agent means computer, node, miner,etc.
5. Tempo or Radix: Tempo uses the method of making a partition of the ledger this is
termed sharding and then all the events that happened in the network are ordered
properly. Basically, transactions are added to the ledger on basis of the order of events
than the timestamp.

Differences between distributed ledgers and blockchain:

In general blockchain and Distributed Ledger Technology are considered as same, but there
are some differences between these two technologies. Blockchain can be classified as a
type of Distributed Ledger Technology. but every Distributed Ledger can not be called a
blockchain.

Basis Distributed Ledger Blockchain Technology

In DLT, blocks can be In Blockchain, blocks are added in

Block Structure organized in different forms. the form of a chain.

It is more scalable because it

It is a subset of DLT, the power of
does not need the power of a
the work consensus mechanism
work consensus mechanism for
adds more functionalities and
the validation of each
security.
Power of Work transaction.

It does not require any tokens In it, tokens must be considered

Tokens or digital currency. while working with Blockchain.

It does not require any specific All blocks are arranged in a

Sequence sequence of data. particular series.

Trust among participating nodes is

Trust among participating less than DLT. Decision-making
nodes is high. powers can be on one hand
Trustability because everyone can mine.

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 Basis Distributed Ledger Blockchain Technology

Data can be chained, but doesn't Data is stored in chained

Data use "blocks" "blocks"

Encrypted Can be encrypted Always encrypted

Generally public and

Private and permissioned, but
permissionless, but some are
can be permissionless
Permission permissioned

Immutable Can be immutable Always immutable

Benefits of Distributed Ledger Technology and Blockchain

1. Security: All records of every transaction are securely encrypted. Once the transaction
is validated, it is completely secure and no one can update or change it. It is a
permanent process.
2. Decentralization: All network members or nodes have a copy of the ledger for
complete transparency. A decentralized private distributed network improves the
reliability of the system and gives assurance of continuous operations without any
interruption. It gives control of information and data in the hand of the user.
3. Anonymity: The identity of each participant is anonymous and does not possibly reveal
their identity.
4. Immutable: Any validated transactions can not be changed as they are irreversible.
5. Transparency: Distributed technologies offer a high level of transparency which is
necessary for the sectors like finance, medical science, banking, etc.
6. Speed: Distributed Ledger Technology can handle large transactions faster than
traditional methods.
7. Smart Contracts: Distributed Ledger Technology supports smart contracts which are
self-executing contracts with the terms of the agreement between buyer and seller being
directly written into lines of code. Smart contracts reduce the need for intermediaries
and offer transparency and automation in the execution of the contract terms.
8. Lower Costs: Distributed Ledger Technology eliminates intermediaries and reduces the
costs associated with intermediaries, which makes the system more cost-effective.

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9. Improved Efficiency: Distributed Ledger Technology reduces the time and costs
associated with traditional transaction methods. It offers faster settlement times,
reduced paperwork, and increased efficiency.
10. Auditing: Distributed Ledger Technology makes auditing easier as every transaction is
recorded and the ledger cannot be altered. This improves the transparency and accuracy
of financial audits.
11. Resilience: Distributed Ledger Technology is more resilient than traditional databases
as it is spread across multiple nodes. This means that even if one node goes down, the
network can still function as the rest of the nodes can continue to validate transactions.
12. Traceability: Distributed Ledger Technology offers complete traceability of assets,
from their creation to their current ownership. This improves accountability and reduces
the risks of fraud and theft.

Disadvantages of Distributed Ledger Technology

1. 51% Attack: The 51% attack is a bit concerning part of this DLT that is to be checked
routinely.
2. Costs of Transaction: DLT which gives high transaction cost as the other nodes are
paid incentives to validate the transaction.
3. Slow Transaction Speed: The major disadvantage of this DLT is the slow speed of
transactions as multiple nodes are attached to this network and it takes time to validate
the transaction by all the other nodes.
4. Scalability Issues: Due to low speed and high transaction costs DLT faces very
difficulties to expand on a large scale.
5. Lack of Regulation: As DLT is a decentralized technology, which can lead to a lack of
regulation, making it difficult to hold accountable any wrongdoings or fraudulent
activities on the network.
6. Energy Consumption: It requires a significant amount of energy to maintain the
network and validate transactions, which can lead to a negative impact on the
environment.
7. Complexity: Implementing and managing Distributed Ledger Technology can be
complex and requires a high level of technical expertise, which can be a barrier to entry
for many organizations and individuals.
8. Privacy Concerns: It can lead to privacy concerns and illicit activities on the network.

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9. Lack of Interoperability: Different Distributed Ledger Technologies may use different
protocols, which can lead to interoperability issues.

Unlocking the potential of blockchain technology

Unlocking the potential of blockchain technology involves exploring its capabilities

and implementing strategies to maximize its benefits. Here are some key considerations for
unlocking the potential of blockchain:

1. Education and Awareness: Promote education and awareness about blockchain

technology among stakeholders, including businesses, policymakers, and the general
public. This includes understanding the underlying concepts, benefits, and potential
use cases of blockchain in various industries.
2. Identifying Use Cases: Identify use cases where blockchain can provide significant
value. Look for scenarios where blockchain's features, such as decentralized
consensus, immutability, transparency, and security, can address existing
inefficiencies, improve trust, and enable new business models.
3. Proof-of-Concept (PoC) and Pilots: Conduct proof-of-concept projects and pilots to
test the feasibility and viability of blockchain solutions. Start with small-scale projects
to validate the technology, evaluate its potential benefits, and identify any technical or
operational challenges.
4. Collaboration and Ecosystem Building: Foster collaboration among various
stakeholders, including industry players, regulators, and technology providers.
Establish consortia, industry forums, or partnerships to collectively explore
blockchain solutions, share best practices, and develop standards that promote
interoperability.
5. Regulatory and Legal Frameworks: Work with regulators and policymakers to
develop supportive regulatory frameworks that encourage blockchain innovation
while addressing concerns such as data privacy, security, and legal compliance. Clear
guidelines and regulations can provide clarity and foster wider adoption of blockchain
solutions.
6. Scalability and Performance Optimization: Address scalability and performance
challenges associated with blockchain technology. Explore solutions such as sharding,
sidechains, or layer 2 protocols to improve transaction throughput, reduce latency, and
enhance the overall performance of blockchain networks.

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 7. Integration with Existing Systems: Identify opportunities to integrate blockchain
with existing systems and infrastructure. This includes leveraging application
programming interfaces (APIs), legacy system integration, or building hybrid
solutions that combine the benefits of blockchain with traditional technologies.
8. Data Privacy and Security: Develop strategies to ensure data privacy and security on
blockchain networks. Explore encryption techniques, zero-knowledge proofs, and
other privacy-enhancing technologies to protect sensitive information while
maintaining the benefits of transparency and auditability.
9. Interoperability and Standards: Promote interoperability among different
blockchain networks and protocols. Develop and adopt industry standards that enable
seamless communication, data exchange, and interoperability across different
blockchain platforms.
10. Continuous Innovation and Research: Encourage ongoing innovation and research
in blockchain technology. Stay updated with the latest developments, participate in
industry events and conferences, and invest in research and development to explore
new applications, scalability solutions, and improvements in blockchain technology.

Blockchain has the potential to transform several industries by providing a secure and
transparent way to store and transfer data. Some of the industries that can be transformed by
blockchain include:

Finance: Blockchain can transform the finance industry by providing a secure and
transparent way to store and transfer financial data. It can also reduce the need for
intermediaries, which can reduce costs.

Healthcare: Blockchain can transform the healthcare industry by providing a secure and
transparent way to store and transfer patient data. It can also improve efficiency by reducing
the need for intermediaries.

Supply Chain: Blockchain can transform the supply chain industry by providing a secure
and transparent way to track products from the manufacturer to the end consumer. This can
improve efficiency and reduce the risk of fraud.

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Real Estate: Blockchain can transform the real estate industry by providing a secure and
transparent way to store and transfer property data. It can also reduce the need for
intermediaries, which can reduce costs.

Voting: Using blockchain for voting capabilities is of interest to many governments,

although few have used the technology for elections at a national level. Various startups have
conducted voting pilots and demonstrations in the U.S., Ukraine and Sierra Leone, among
others. However, none have successfully demonstrated how to resolve the challenges of
authenticating voters or resolving broader issues of voter fraud or voter intimidation.

Cryptocurrency

A cryptocurrency or crypto is a virtual currency secured by cryptography. It is

designed to work as a medium of exchange, where individual ownership records are stored in
a computerised database.

Cryptocurrency is a digital payment system that doesn't rely on banks to verify

transactions. It’s a peer-to-peer system that can enable anyone anywhere to send and receive
payments. Instead of being physical money carried around and exchanged in the real world,
cryptocurrency payments exist purely as digital entries to an online database describing
specific transactions. When you transfer cryptocurrency funds, the transactions are recorded
in a public ledger. Cryptocurrency is stored in digital wallets.

Cryptocurrency received its name because it uses encryption to verify transactions.

This means advanced coding is involved in storing and transmitting cryptocurrency data
between wallets and to public ledgers. The aim of encryption is to provide security and
safety.

The first cryptocurrency was Bitcoin, which was founded in 2009 and remains the
best known today. Much of the interest in cryptocurrencies is to trade for profit, with
speculators at times driving prices skyward.

The defining trait of cryptocurrencies is that they are not issued by the government
agency of any country making them immune to any interference and manipulation from them.

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Definition of Cryptocurrency
In simplistic terms, Cryptocurrency is a digitised asset spread through multiple
computers in a shared network. The decentralised nature of this network shields them from
any control from government regulatory bodies.

The term “cryptocurrency in itself is derived from the encryption techniques used to secure
the network. As per computer experts, any system that falls under the category of
cryptocurrency must meet the following requirements.:

1. Absence of any centralised authority and is maintained through distributed networks

2. The system maintains records of cryptocurrency units and who owns them
3. The system decides whether new units can be created and in case it does, decided the
origin and the ownership terms
4. Ownership of cryptocurrency units can be proved exclusively cryptographically.
5. The system allows transactions to be performed in which ownership of the
cryptographic units is changed.

Key steps to buy cryptocurrency:

Step 1: Pick the best cryptocurrency exchange.

Step 2: Open a trading account and confirm your email. Connect your phone now.
Step 3: Verify your identification in step three. Fund Your Account next.
Step 4: Purchasing and Investing in Cryptocurrency.
Step 5: Store your cryptocurrency.
Step 6: Choose a strategy in the last step.

The minimum amount you can invest in cryptocurrencies:

We buy or sell digital money for as low as $2.00 ($2 or €2) that is denominated in our home
currency.

Types of Cryptocurrency
The first type of crypto currency was Bitcoin, which to this day remains the most-
used, valuable and popular. Along with Bitcoin, other alternative cryptocurrencies with
varying degrees of functions and specifications have been created. Some are iterations of
bitcoin while others have been created from the ground up

Bitcoin was launched in 2009 by an individual or group known by the pseudonym “Satoshi
Nakamoto. As of March 2021, there were over 18.6 million bitcoins in circulation with a total
market cap of around $927 billion.

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The competing cryptocurrencies that were created as a result of Bitcoin’s success are known
as altcoins. Some of the well known altcoins are as follows:

1. Litecoin
2. Peercoin
3. Namecoin
4. Ethereum
5. Cardana
Today, the aggregate value of all the cryptocurrencies in existence is around $1.5 trillion—
Bitcoin currently represents more than 60% of the total value.

Advantages of Cryptocurrencies

The following are some of the advantages of cryptocurrencies:

1. Private and Secure: Blockchain technology ensures user anonymity and at the same
time the use of cryptography in blockchain makes the network secure for working with
cryptocurrencies.
2. Decentralized, Immutable, and Transparent: The entire blockchain network works on
the principle of shared ownership where there is no single regulating authority and the
data is available to all the permissioned members on the network and is tamper-proof.
3. Inflation Hedge: Cryptocurrencies are a good means of investing in times of inflation
as they are limited in supply and there is a cap on mining any type of cryptocurrency.
4. Faster Settlement: Payments for most cryptocurrencies settle in seconds or minutes.
Wire transfers at banks can cost more and often take three to five business days to settle.
5. Easy Transactions: Crypto transactions can be done more easily, in a private manner in
comparison to bank transactions.
6. Cheaper :It is a cheaper alternative compared to other online transactions
7. Minimal processing fees: Funds transfer are completed with minimal processing fees.
8. Without the need of third party: Funds transfer between two parties will be easy
without the need of third party like credit/debit cards or banks

Disadvantages of Cryptocurrencies

The following are some of the drawbacks of cryptocurrencies:

1. Scalability: Scalability is one of the major concerns with cryptocurrencies.
Cryptocurrencies cannot compete with the number of transactions that payment giants
like VISA, and Mastercard processes in a day.

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 2. Less awareness: Cryptocurrency is still a new concept for the people and the long-term
sustainability of cryptocurrencies remains to be seen.
3. Volatility: Cryptocurrencies can be highly volatile, with prices fluctuating rapidly
and unpredictably.
4. Lack of Regulation: Cryptocurrencies are not yet fully regulated by governments,
which can lead to uncertainty and potential risk for users.
5. Limited Acceptance: While the number of merchants accepting cryptocurrencies is
growing, they are still not widely accepted as a form of payment.
6. Hacking and Fraud: Cryptocurrencies are vulnerable to hacking and fraud, and
there have been numerous high-profile incidents of theft and scams in the
cryptocurrency world.

Central Bank Digital Currency (CBDC)

A Central Bank Digital Currency (CBDC), or national digital currency, is simply
the digital form of a country’s fiat currency. Central bank digital currencies (CBDCs) are a
form of digital currency issued by a country's central bank. They are similar to
cryptocurrencies, except that their value is fixed by the central bank and equivalent to the
country's fiat currency.

• Instead of printing paper currency or minting coins, the central bank issues electronic tokens.
• This token value is backed by the full faith and credit of the government.
• CBDC is a legal tender issued by a central bank in a digital form.
• It is similar to a fiat currency issued in paper and is interchangeable with any other fiat
currency.
Types of CBDCs
There are two types of CBDCs, wholesale and retail. Financial institutions are the
primary users of wholesale CBDCs, whereas consumers and businesses use retail CBDCs.

Wholesale CBDCs
Wholesale CBDCs are similar to holding reserves in a central bank. The central bank
grants an institution an account to deposit funds or use to settle interbank transfers. Central
banks can then use monetary policy tools, such as reserve requirements or interest on reserve
balances, to influence lending and set interest rates.

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 Retail CBDCs
Retail CBDCs are government-backed digital currencies used by consumers and
businesses. Retail CBDCs eliminate intermediary risk—the risk that private digital currency
issuers might become bankrupt and lose customers' assets.
There are two types of retail CBDCs. They differ in how individual users access and
use their currency:

• Token-based retail CBDCs are accessible with private keys or public keys or both.
This method of validation allows users to execute transactions anonymously.
• Account-based retail CBDCs require digital identification to access an account.

Merits

• Reduce the cost of currency management

• May reduce inflation – as a high currency to GDP ratio is inflationary (might decline
unnecessary cash holdings.
• Digital Rupee transactions will be instantaneous as opposed to the current digital payment
experience.
• Enabling real-time payments without any inter-bank settlement thus, reducing transaction
cost and time.
• The cost of printing, transporting and storing paper currency can be substantially reduced.
• Financial inclusion.
• Better targeting of beneficiary of cash subsidy schemes
• Counter the growth of private forms of digital money.
• The state-backed digital currency can provide investor/consumer protection, the private can
confidently invest in the associated infrastructure without any doubts over its regulation.
• Less volatile than other private digital currency as regulated by the RBI
• Better monetary policy transmission
• The central bank would be able to keep a track of the exact location of every unit of the
currency, thereby curbing money laundering, terror financing and counterfeiting.
• Reduce dependence on dollar for international transaction

Roles of DLT in the financial industry:

Distributed ledger technology (DLT), commonly known as blockchain, has a

significant role in transforming financial services. Here are some key roles of DLT in the
financial industry:

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1. Enhanced Security: DLT provides a secure and tamper-proof platform for
financial transactions. The decentralized nature of DLT ensures that transactions
are verified and recorded across multiple nodes in the network, making it difficult
for malicious actors to manipulate or tamper with data. This improves security and
reduces the risk of fraud.
2. Improved Efficiency and Transparency: DLT eliminates the need for
intermediaries in financial transactions. By enabling peer-to-peer transactions and
automated smart contracts, DLT reduces processing time, minimizes paperwork,
and streamlines settlement processes. It also provides transparency, as all
participants in the network have access to the same set of data, reducing the need
for reconciliation and improving overall efficiency.
3. Cross-Border Payments and Remittances: DLT enables faster and more cost-
effective cross-border payments and remittances. Traditional methods can be
slow, expensive, and involve multiple intermediaries. DLT-based solutions
simplify the process by providing a decentralized infrastructure that facilitates
direct transfers, reduces fees, and eliminates the need for intermediaries.
4. Financial Inclusion: DLT has the potential to promote financial inclusion by
providing access to financial services for the unbanked and underbanked
populations. With DLT-based solutions, individuals who lack access to traditional
banking services can participate in the financial ecosystem, create digital
identities, and access various financial products and services.
5. Smart Contracts and Automation: DLT enables the execution of smart
contracts, which are self-executing agreements with predefined conditions and
terms. Smart contracts automate processes, reducing the need for manual
intervention and improving accuracy. They can facilitate automated payments,
trigger actions based on predefined events, and streamline complex financial
workflows.
6. Supply Chain Finance and Trade: DLT has applications in supply chain finance
and trade finance. It provides a transparent and secure platform for tracking goods,
verifying authenticity, and managing supply chain financing. DLT can enable
efficient inventory management, reduce fraud in trade finance, and facilitate faster
and more transparent trade settlements.
7. Regulatory Compliance: DLT can assist in regulatory compliance by providing
immutable and auditable records of financial transactions. Regulators can access
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 the distributed ledger to verify compliance with anti-money laundering (AML)
and know-your-customer (KYC) regulations. DLT can also enable automatic
reporting, ensuring transparency and reducing compliance costs for financial
institutions.
8. Tokenization of Assets: DLT allows for the tokenization of assets, representing
real-world assets as digital tokens on a blockchain. This opens up new avenues for
fractional ownership, liquidity, and trading of traditionally illiquid assets such as
real estate, art, and intellectual property. Tokenization can democratize access to
investment opportunities and enable more efficient asset management.
9. Data Integrity and Privacy: DLT ensures data integrity by providing a
transparent and tamper-proof record of transactions. It can also incorporate
privacy features, allowing for selective disclosure of information while
maintaining confidentiality. This can be particularly useful in sensitive financial
transactions and compliance with data privacy regulations.
10. Collaborative Ecosystems: DLT facilitates collaboration and trust among
different participants in the financial ecosystem. It enables financial institutions,
technology providers, and other stakeholders to collaborate on shared platforms,
reducing duplication of efforts, enhancing interoperability, and fostering
innovation through open APIs and standardized protocols.

DLT has the potential to revolutionize financial services by improving security, efficiency,
transparency, and access to financial services. However, challenges related to scalability,
interoperability, regulatory frameworks, and industry-wide adoption need to be addressed to
fully realize the potential of DLT in the financial industry.

AI IN BANKING

Almost every industry, including banking and finance, has been significantly
disrupted by artificial intelligence. This industry is now more customer-centric and
technologically relevant thanks to the use of AI inside banking applications and services.

By enhancing efficiency as well as making a judgement based upon information that

is incomprehensible to a particular operator, AI-based technologies can assist bankers reduce
expenses. Additionally, clever algorithms may quickly detect incorrect facts.

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Future of artificial intelligence (AI) in banking

The future of artificial intelligence (AI) in banking holds tremendous potential for
transforming the industry in various ways. Here are some key aspects that illustrate the future
of AI in banking:

1. Enhanced Customer Experience: AI will continue to play a crucial role in providing

highly personalized and seamless customer experiences. Advanced chatbots and
virtual assistants will become more sophisticated, understanding natural language and
context to offer more accurate and tailored responses. Voice assistants will become
increasingly prevalent, allowing customers to interact with their banks using voice
commands.
2. Hyper-Personalization: AI algorithms will leverage vast amounts of customer data
to provide hyper-personalized banking experiences. This includes customized product
recommendations, personalized financial advice, and tailored notifications based on
individual preferences, financial goals, and life events.
3. Advanced Analytics and Insights: AI-powered analytics will unlock valuable
insights from big data, enabling banks to gain a deeper understanding of customer
behavior, market trends, and competitive dynamics. These insights will drive product
innovation, targeted marketing campaigns, and more accurate pricing strategies.
4. Robotic Process Automation (RPA): RPA will continue to automate routine and
manual tasks, reducing costs and improving operational efficiency. AI-powered bots
will handle repetitive processes such as data entry, document verification, and
compliance checks, allowing bank employees to focus on higher-value activities.
5. Fraud Detection and Prevention: AI algorithms will evolve to better detect and
prevent fraudulent activities. Machine learning models will continuously learn from
historical data to recognize new fraud patterns and anomalies in real-time, enabling
banks to proactively mitigate risks and protect customer assets.

6. Risk Assessment and Credit Scoring: AI will further enhance risk assessment and
credit scoring models, enabling banks to make more accurate lending decisions and
offer personalized loan terms. This will help improve credit access and expand
financial inclusion.

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 7. Regulatory Compliance: AI will assist banks in complying with complex regulations
by automating compliance checks, monitoring transactions, and ensuring adherence to
anti-money laundering (AML) and know-your-customer (KYC) requirements. AI-
powered systems will help banks stay updated with changing regulations and avoid
penalties.
8. Voice and Facial Recognition: AI-powered biometric authentication methods, such
as voice and facial recognition, will provide secure and convenient access to banking
services. These technologies offer robust identity verification, reducing the reliance
on traditional passwords and enhancing customer security.
9. Collaboration with FinTech Startups: Banks will increasingly collaborate with
FinTech startups and technology firms to leverage AI innovations. This collaboration
will foster the development of innovative solutions, accelerate the adoption of AI
technologies, and drive industry-wide transformation.
10. Ethical and Responsible AI: As AI becomes more prevalent in banking, the industry
will emphasize ethical and responsible AI practices. Transparency, fairness, and data
privacy will be prioritized to maintain customer trust and regulatory compliance.

The future of AI in banking is expected to revolutionize customer experiences, improve

operational efficiency, strengthen risk management, drive innovation, and enhance security
measures. However, it is important to address challenges related to data privacy, ethical
considerations, and regulatory compliance to ensure responsible and beneficial use of AI in
the banking industry.

Applications of Artificial Intelligence in Banking:

Artificial intelligence (AI) has numerous applications in the banking industry. Here
are some key areas where AI is commonly utilized:

1. Customer Service and Support: AI-powered chatbots and virtual assistants provide 24/7
customer support, answering queries, assisting with transactions, and offering personalized
recommendations. These systems can understand natural language, learn from interactions,
and provide efficient and personalized assistance to customers.

2. Fraud Detection and Prevention: AI algorithms analyze large volumes of data in real-
time to detect fraudulent activities. By monitoring patterns, anomalies, and transaction

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behavior, AI systems can identify and prevent potential fraud, enhancing security and
protecting customer accounts.

3. Risk Assessment and Credit Scoring: AI analyzes customer data, credit histories, and
other relevant information to assess creditworthiness accurately. It improves risk assessment
and credit scoring models, enabling banks to make informed lending decisions, offer
personalized loan terms, and manage credit risks more effectively.

4. Robo-Advisors: AI-powered robo-advisors provide automated investment advice and

portfolio management services. By considering customer goals, risk tolerance, and market
trends, these systems recommend suitable investment options, optimize portfolios, and offer
ongoing monitoring and rebalancing.

5. Process Automation: AI automates routine and manual tasks, improving operational

efficiency. It can handle data entry, document verification, compliance checks, and other
repetitive processes, freeing up bank employees to focus on higher-value activities.

6. Natural Language Processing (NLP): NLP enables AI systems to understand and

interpret human language. It facilitates document analysis, contract reviews, regulatory
compliance, and assists with tasks such as extracting information from documents,
identifying relevant clauses, and ensuring compliance with legal and regulatory requirements.

7. Personalized Banking Experiences: AI leverages customer data to offer personalized

financial experiences. It provides tailored product recommendations, personalized financial
advice, and customized notifications based on individual preferences, financial goals, and life
events.

8. Risk Management and Regulatory Compliance: AI assists with risk management by

analyzing vast amounts of data to identify potential risks and compliance issues. It helps
banks comply with regulatory requirements, monitor transactions for suspicious activities,
and ensure adherence to anti-money laundering (AML) and know-your-customer (KYC)
regulations.

9. Predictive Analytics: AI uses historical data and market trends to make accurate
predictions about customer behavior, market conditions, and financial risks. It assists banks
in making data-driven decisions, developing targeted marketing campaigns, and managing
portfolios more effectively.

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10. Cybersecurity: AI strengthens cybersecurity measures by continuously monitoring
network traffic, identifying potential threats, and responding to attacks in real-time. Machine
learning algorithms can learn from patterns and anomalies, enabling banks to enhance their
security protocols and protect customer data.

These applications of AI in banking improve customer experiences, streamline

operations, enhance risk management, enable personalized financial services, and strengthen
security measures, ultimately driving efficiency and innovation within the industry.

Importance of AI in the Banking

The adoption of AI-based technologies in the banking industry has many advantages,
including:
• Improved Efficiency – AI can automate many routine and mundane tasks, freeing up
employees to focus on more complex and value-added tasks.
• Enhanced Customer Experience – AI-powered chatbots and virtual assistants can
provide personalized and immediate assistance, improving the overall experience.
• Better Risk Management – AI can help banks identify potential risks and frauds more
accurately and quickly, reducing the risks themselves and piling costs associated with
that kind of incident.
• Cost Savings – By automating tasks and improving efficiency, AI can simply help
banks reduce costs and increase profitability.

• Customer satisfaction: Customer satisfaction is an important requirement not only

for the banking industry but for all industries. Artificial Intelligence helps the bank
not only increase revenue but also make faster decisions and maintain healthy client
connections.

• Chatbots: This AI provides the use of Natural Language Processing to give relevant
answers to the different enquiries of the customers. Chatbots are now being used in
the banking industry to provide consumers with a 24/7 service experience.

• Fraud Detection: The banking industry can reduce the chance of fraud activities by
significantly using Artificial Intelligence.

• 24/7 Availability & Higher Productivity: The very first advantage of AI machines is
that it does not require frequent refreshment breaks, just like human beings. AI
machines can be programmed to work for long, and these machines give higher
productivity as compared to human beings.
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 • Digital Assistance: Nowadays, banks have started using machines instead of human
beings to interact with customer.
• Management of Repetitive Jobs: Repeated jobs are tiresome and humans don’t like
their work to be slowed over such tasks. The repeated jobs can be easily handled by
making the use of AI algorithms.

• Error Reduction: One of the most advantageous benefits of Artificial Intelligence is,

it helps in reducing the error probability and increases the chance of higher accuracy.

Banking reimagined wih AI:

Artificial intelligence (AI) has the potential to significantly transform the banking industry by
automating processes, enhancing customer experiences, improving risk management, and
enabling personalized financial services. Here are some ways banking can be reimagined
with AI:

1. Chatbots and Virtual Assistants: AI-powered chatbots and virtual assistants can
provide 24/7 customer support, answer basic queries, assist with transactions, and
offer personalized financial advice. These AI systems can understand natural
language, learn from customer interactions, and continuously improve their responses.
2. Fraud Detection and Prevention: AI algorithms can analyze vast amounts of data to
detect fraudulent activities in real-time. By monitoring patterns, anomalies, and
suspicious transactions, AI can enhance fraud prevention measures and reduce the
risks associated with financial crimes.
3. Risk Assessment and Credit Scoring: AI can analyze customer data, including
transaction history, credit scores, and social media profiles, to assess creditworthiness
accurately. It can provide more comprehensive risk assessments, enabling banks to
make informed lending decisions and offer personalized loan terms.
4. Personalized Banking Experiences: AI can leverage customer data to offer
personalized recommendations, such as tailored investment portfolios, savings plans,
or insurance options. By understanding individual preferences, AI can anticipate
customer needs, suggest relevant products, and provide customized financial
guidance.
5. Robo-Advisors: AI-powered robo-advisors can automate investment advice and
portfolio management. These systems use algorithms to analyze customer goals, risk

26
 tolerance, market trends, and other factors to provide personalized investment
recommendations at lower costs compared to traditional human advisors.
6. Process Automation: AI can automate repetitive and time-consuming tasks, such as
data entry, document verification, and compliance checks. This streamlines internal
operations, reduces errors, and frees up bank staff to focus on more complex and
value-added activities.
7. Natural Language Processing (NLP): NLP enables AI systems to understand and
interpret human language, facilitating automated document analysis, contract reviews,
and regulatory compliance. It can extract key information from documents, identify
relevant clauses, and ensure adherence to legal and regulatory requirements.
8. Predictive Analytics: By analyzing historical data and market trends, AI can make
accurate predictions about customer behavior, market conditions, and financial risks.
This can assist banks in making data-driven decisions, developing targeted marketing
campaigns, and managing their portfolios more effectively.
9. Cyber-security: AI can play a crucial role in strengthening cybersecurity measures
by continuously monitoring network traffic, identifying potential threats, and
responding to attacks in real-time. Machine learning algorithms can learn from
patterns and anomalies, enabling banks to enhance their security protocols and protect
customer data.
10. Voice and Facial Recognition: AI-powered biometric authentication methods, such
as voice and facial recognition, can provide secure and convenient access to banking
services. These technologies offer robust identity verification, reducing the reliance
on traditional passwords and enhancing customer security.

It's important to note that while AI offers numerous benefits, its adoption should be
accompanied by appropriate regulations, ethical considerations, and transparent
communication with customers to ensure data privacy and maintain trust in the banking
industry.

CLOUD BANKING:
The term "cloud-based banking" refers to the deployment and management of the
banking infrastructure to manage key banking functions and financial services delivered via
the cloud without the use of dedicated physical servers. A cloud bank is a type of banking
infrastructure that exists on the cloud.

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 Cloud banking is the on-demand delivery of hosted computing services (servers, data
storage, communication and networking, applications and data analytics) to banks, credit
unions, Fintechs and other financial institutions (FIs) via the Internet. With cloud banking,
FIs have access to scalable, cost-efficient computing resources and IT services . The cloud
controls a bank’s data storage and ensures 360-degree visibility over every transaction. Banks
make the most out of cloud computing by monitoring end-to-end processes. An additional
benefit to Cloud Banking is that the banks will be soon notified if there is any security
breach.

Why Cloud Banking

Banks of 2030 will be easier to use, more attractive to customers, and more profitable
than today's banks. They will employ a variety of technologies (including open APIs and 5G)
that make it possible to connect financial services with homes, machinery, vehicles, and other
devices. Banks will offer embedded financial services through consumer apps on
smartphones.

Customers will have greater control over their money via digital platforms that enable
them to pay bills online or transfer funds between accounts without visiting a branch office.
They will also be purposeful in aligning their services with environmental, moral, and social
values.

Cloud Deployment Methods

• Hybrid Clouds
A cloud is a term used to describe a group of interconnected computers that come
together to form a single entity.
• Community Clouds
This model of deployment uses the cloud to help a community of users with similar
needs and concerns.
• Public Clouds
This is made available to the public and is owned by an organization that provides
cloud services.
• Private Clouds
This is a cloud service that is managed by the bank and can only be accessed from
within the bank. This option is more secure than other services but comes at a cost.

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Benefits in switching to Cloud Banking in India

1. Improved Customer Experience: With the cloud, banks can offer access to banking
services anytime and anywhere, leading to a better customer experience. Buyers and
sellers, might be brought together through cloud-based shared applications. Cloud
Computing can enhance Customer Experience more precisely.
2. Reduced costs: Banks can save money by moving their applications and data to the
cloud. The pay-as-you-go pricing model of public clouds makes it more affordable for
financial institutions to use these services.

3. Faster processing speeds: Cloud platforms are designed for fast performance and
can handle large amounts of data quickly and easily. This allows banks to improve
their transaction processing speeds and reduce latency problems.

4. Greater scalability: Cloud platforms can scale up or down as needed, which gives
financial institutions the flexibility they need to best serve their customers.

5. Enhanced security: The public cloud is a more secure environment than most on-
premises systems, and it offers multiple layers of protection against data breaches and
other attacks.

6. Compliance with regulations: Banks can meet regulatory compliance requirements

by using cloud platforms that are compliant with financial industry regulations.
7. Centralized Data Repository: Cloud platforms enable seamless integration of
disparate business data and operational systems with secure & easy data sharing. It
creates centralized and connected data to drive integrated decisions and solve
customer problems more quickly.
8. Disaster Recovery: The most significant benefit of transitioning to the cloud is its
robust disaster recovery with integrated redundancies. With the financial world
moving at a much faster pace, the cloud allows banks to streamline opportunities,
meet customer expectations and operate at the speed of business by regaining access
to actionable insights in case of disruptive events or natural disasters.
9. Access to Powerful Data Management Capabilities & API Ecosystem: Advanced
analytics and cloud API ecosystem allow banks to meet the changing demands of
customers with open banking. Banks and financial services can also optimize their
reconciling efficiency and cash and liquidity management.

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 10. Increased Efficiency: Cloud technology in banking helps financial services
organizations to streamline operations with improved efficiency. Payment processes
can be further simplified by connecting both buyers and sellers on a shared
application. This helps improve transaction speed and easier to track data.
11. Business Continuity: Cloud computing can assist banks and financial services firms
with increased data protection, fault tolerance, and disaster recovery for financial
firms. It provides a high level of redundancy and backup at a comparatively lower
price than traditional managed solutions.
12. Agility and Transformation: Financial organizations can experience shorter
development cycles for new products through flexible cloud-based operating models.
The related technology supports a faster and more efficient response to the needs of
modern banking customers. It enables businesses to shift non-critical services,
including maintenance, software patches and other computing issues. This helps
financial firms focus more on business growth.
13. Reduction in Risks
Cloud service providers offer a feasible alternative to out-of-date technologies that are
becoming increasingly sensitive to data leakage. Cloud-based solutions can give enhanced
security by allowing for the quick discovery of potential breaches and embedding protection
to ensure banking data. Cloud technologies can provide a high level of availability and
redundancy that can assist with disaster response.
14. Increased Adaptability
Cloud technology enables firms to respond rapidly to changing market conditions,
employing data and applied analytics to create a customer experience and operational
productivity benefits for banks and credit unions seeking more business agility. The potential
range from adapting to changing consumer or competition dynamics to enabling the
scalability of technology use.

15. Compatible

Cloud-based banking services are compatible with any platform. Organizations that use
legacy software may experience compatibility issues when upgrading their infrastructure.

16. Convenience

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 As a result of the convenience offered by cloud-based banking solutions, many banks are
shifting to this method of service. CSPs are currently offering data management services,
enabling banks to manage intricate operations internally.

At present, Amazon, Microsoft, Google, Alibaba, and Huawei have a stranglehold on the
cloud banking market, controlling over 80% of the sector. This indicates that these industry
giants are investing heavily in cloud-based banking..

17. Fraud Detection

Financial organizations cannot afford to ignore data breaches. They must have secure data
management systems in place to keep sensitive information safe from cybercriminals. Cloud-
based banking solutions provide complete protection to digital retail banks from unauthorized
third-party access. These solutions can also aid digital banking institutions in detecting
anomalies such as identity fraud and money laundering activities.

18. Analytics

Banks that use cloud-based banking solutions enjoy the benefit of automated data
reporting and analysis. Also, Computing power is essential to managing banking operations.
Cloud computing enables you to maintain an eco-friendly infrastructure for your internal and
external services.

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