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Credits, a Singapore based public blockchain platform with an open source code and its own internal cryptocurrency CS, is being explored as a means of simplifying compliance with KYC requirements for financial institutions including banks.

In order to comply with KYC, banks and other financial institutions must dedicate a huge amount of resources. Each financial institution has to satisfy KYC requirements for every new customer, even though the customer has probably completed a KYC procedure somewhere else before. Banks have to collect, track and store huge amounts of data, so that it may be reported to regulatory institutions in a timely manner.

In this case, creation of a client identification system based on the distributed ledger technology appears to be highly relevant. When a new client enters into the ecosystem, a bank verifies the documents and uploads the data onto the blockchain. Whenever a new data is needed to be appended, the ledger could enable encrypted updates to the ledger. These updates can be accessed by other entities in real time as and when required. Direct access to the KYC data saves huge amount of time for institutions. Besides, required compliance reports can be automatically generated from the data of the blockchain. This helps to reduce non-compliance penalties.

When it comes to security, every participant (bank and regulatory institution) interacts with the blockchain using a public-private cryptographic key combination. Since the platform is a transparent system, no entity has the ability to modify or erase a block without it being recorded on the blockchain. Records/blocks are validated by peers, like other financial institutions, on the blockchain network. As a peer to peer network, each financial institution would be able to trust the others. There is no centralised authority that can be compromised and there’s no way to hack the cryptographically secure data within the general ledger. In this case, manual errors while performing the KYC initiation can be avoided.

The platform completes certain checks to preserve the integrity of the chain and the correspondence of information on different nodes of the network. It checks all transactions on the balance sheet, in which the amount of incoming and outgoing transactions is checked for compliance. The previous block hash is checked for a sum and EDS block is checked: before sending a new block to the network, the writing node signs it with its digital signature for identification.

Each network node has a key pair (private and public key) to sign the block. One cannot participate in consensus until one sends the transaction to the network. The purpose of this is to increase the confidence in the nodes.

The platform enables users to be identified on a single occasion and this information is stored securely with access granted to other financial institutions in the ecosystem. All data is stored in the open file, yet some information can be encrypted with homomorphic encryption based on elliptical curves in order to limit the general access. Only the ecosystem participants are allowed to encrypt and decrypt the data.

Due to the lack of mining and the unique type of consensus dPoS + BFT, the platform can operate at high speed (0.1 second per transaction) and conduct a large amount of transactions per second (more than 1 million per second). The cost of transactions depends on the network load and the number of nodes and is approximately 0.0001 USD transaction. 

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What does it take for Bitcoin to achieve mass-adoption?

CryptoCoinPrediction.com is not responsible for the article’s content or accuracy and may not share the author’s views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.

What does it take for Bitcoin to achieve Mass-Adoption?

The biggest obstacle for Bitcoin right now is, that so few people use Bitcoin. But why do so few people actually use Bitcoin from a day-to-day basis? Well, the answer is, because so few people use Bitcoin. That might sound a bit confusing right away, but I will explain myself.

Bitcoin has the obstacle to overcome, same as Facebook. Facebook became so valuable, because literally every friend of yours, and their parents where using it. If no one used Facebook, then I really doubt it would be nearly as valuable to humanity as it is today.

The same exact thing also applies to Bitcoin. What makes money valuable, is the fact that you can pay anybody for anything with it. Good luck paying your local supermarket in Bitcoins. It just doesn’t make sense to do so.

This is also called the network effect. It sates, that a system is only so valuable, as the number of people using that system.

So, let’s dive into the 3 deciding factors, that must happen for Bitcoin to fully achieve mass adoption.

First, of course, is the support by a big corporation or even country. For example, if a big company like McDonalds starts to accept Bitcoin, then people would be more inclined to make purchases with Bitcoin. This makes total sense, because why would anybody adopt the usage of Bitcoin, if you couldn’t make any real-world purchases with it? Exactly, it doesn’t make any sense whatsoever.

The first point was pretty obvious, so let’s look at the other deciding factors, that are crucial for Bitcoin to be mass-adopted.

Did you actually know, that a third of the world’s population, 2,5 million adults to be precise, do not have access to the banking system? Yeah, what people in the first-world countries take completely for granted, isn’t all that common all around the world: A bank account. On the other side, many more people in these third-world countries do have mobile phones, but no bank accounts. So, what if all those people start using Cryptocurrencies, like Bitcoin, for their online and day-to-day transactions? They could skip the traditional banking system and directly buy and sell Bitcoin from their smartphones. If one third (or even less) of the world population starts to use Bitcoin, it will gain world-wide recognition and overtake any other currency.

The third scenario that could happen, is that a major economic collapse or abuse occurs. When this happens, lots of people will want to transfer their wealth to something that isn’t dependent on any country or government, but is universally accepted in every country of the world. There aren’t many options for such things. One of these things is, gold. And the other could be Bitcoin, which I see as the digital version of Gold.

I hope we will never have to experience such a catastrophic event in our lifetime, but it sure is a positive thing for Bitcoin, since lots of people will adopt it.

These are all the point I could think of. Thanks a lot for reading and have an awesome day! Visit me at flashipcrypto.com for more Crypto-article?