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How Blockchain Technology Will Help African Banks

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blockchain Technology in african banks

How Blockchain Technology Will Help African Banks Including Nigeria, South Africa, Kenya, etc

Blockchain technology have been quite controversial since its birth in 2009 but became more popular in 2016 when many people started adopting and venturing into the new blockchain Technology in Nigeria. On a general scale, during the time of ponzi scheme Era

The underlying technology powering Bitcoin and other Cryptocurrencies is currently poised and threatening to affect the Nigerian Banking sectors as well as other financial sectors.

In this article, we will be taking a critical view on the Blockchain Technology in Nigeria and How it will Help the Nigerian and African banking and financial sectors.

My is GT Igwe Chrisent, A Tech Savy and Blockchain Enthusiast.

Quick Overview of the Meaning and Concept of Blockchain Technology

According to Wikipedia,

“A blockchain is a decentralized, distributed and public digital ledger that is used to record transactions across many computers so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the consensus of the network”.

The blockchain technology is transparent and does not allow any alteration of any kind once and transaction on contract have been sent and confirmed in the network.

Its true that blockchain presents numerous opportunities to transform how people exchange and store value. The technology provides participants in a business network with a shared, immutable history of transactions, records cannot be altered once they’ve been agreed upon through consensus and added to the ledger.

In a post on Quartz Africa which was talking about Blockchain technology being used in Kenya’s agribusiness, it said

“Blockchain technology could be used to help lower the barrier to enter financial systems and establish new markets and products”.

Related: The importance of blockchain Technology

At the moment, there are many claims that the future of banking sectors and established models that commerce is run on is in trouble due to the opportunity that blockchain technology brings.

In all of this, we know that;

Change isn’t easy, especially when changing requires the overhaul of existing systems as well as collaboration among banks and financial services providers who probably never thought they’d work together on anything. However, with so many African banks and startups interested in cashing in on the potential value of blockchain technology, it’s no longer a question of if blockchain will be used in banking, but when and how.

So, let’s look at

How Blockchain Will Help The African Banking sectors in 5 Ways

1. Payments: (Speeding time to Dispute Settlement)

internet and blockchain payments

Blockchain Used For Dispute Settlement: Even though digital payment solution have becomes very popular, money transfer between individuals have always had trust issues if the money was sent or not. That is the reason why a third party monetary escrow like banks and other financial services came into play, on this, banks can integrate blockchain technology into their systems and have every banking transaction send tokens including the transaction details and get recorded on the blockchain network of the bank as evidence of payment. every banking transaction SMS to each user will have Blockchain Transaction Hash ID and wallet address attached in the SMS and emails sent to users.

Related: Best Cryptocurrency Wallets right now

This will reduce the stress and process required for one to undergo when there are payment disputes between two pairs as they can simply view their transaction on the blockchain network to see it was actually recorded.

This will, in turn, save banks extra labour in the cause of settling banking disputes.

Transaction Speed: If a Nigerian banking payment involves crosses borders and exchanges, it could take days or weeks for clearing and settlement to occur because of inefficiencies in reconciling records on separate ledgers from intermediaries. Blockchain Technology removes all these loopholes and allows instant transactions across border trade.

Related: Top 8 women making headlines in the Blockchain space

Every cross-border transaction can view the ledger of transactions that is updated through consensus and made immutable through cryptography.

2. Payment Security:

secured blockchain payments

Blockchain will help African Banks with banking security as Transactions don on the blockchain are secured and cannot be hacked. Every monetary Transaction carried out on the blockchain cannot be forged or twisted and as such, there is higher level of trust than banking traditionally where there are always disputes of misplaced/stolen funds.

3.   Trade finance: Reducing friction in global markets

5 advantages of Blockchain Technology

Friction in global markets transactions makes getting financing and completing trades a lengthy and complex process for anyone.

African banking activities such as lending, issuing letters of credit, factoring, all These involves Paper documents in the traditional banking system been sent To and Fro to be validated and reconciled by different third parties and sender/receiver, and in the interim, capital gets tied up and business slows leading to loss on the receiver as he/she pays us extra charges while in the process of waiting for day/weeks to have transactions confirmed.

All these problems will be stopped if the African banks can integrate blockchain technology.

4.     Reimagining banking with blockchain

5 advantages of Blockchain Technology 2

According to a report from the IBM Institute for Business Value, 91 percent of banks are investing in blockchain solutions be 2018.

Many western banks right now are transforming their industry with the Blockchain technology because of the seamless future and powerful concept undermining it.

Summary

The importance of the blockchain technology to the African banks including Nigeria banks, South African Banks, Kenya Banks, Ghana, etc cannot be overemphasized. The advantages of implementing blockchain into Nigerian Banks are quite enormous just as there is also some bad side to it on the side of the banks, but then, it doesn’t matter since its all to the best interest of users.

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What is Cryptocurrency And How Does It Work? 

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Obiex finance website

Cryptocurrencies are decentralized digital assets that operate on blockchain technology that in turn operates by storing a ledger of every transaction on all nodes powering the blockchain. 

In layman’s terms, blockchain technology is like a record keeper, it collects data (in blocks) and links one block of data to another, forming a chain. The data on the blockchain is open for all to see and cannot be easily altered. Blockchain technology can be used for a variety of use cases besides cryptocurrency, ranging from voting to crowdfunding, keeping health records, etc.

Using Bitcoin as an example, nodes are computers connected to the network to mine Bitcoin,  – this collection of independent nodes working together is what makes the network decentralized.

The decentralized nature of cryptocurrency is down to the creators recognizing flaws in traditional banking & financial systems like governments and financial institutions acting only in their best interests and not in the best interest of the common man, leading Satoshi Nakamoto (the creator of bitcoin and blockchain technology) to take steps to rectify that.

Related: What are NFTs?

To make cryptocurrency transactions, you will need to have a set of both public and private keys that will act as passwords protecting your crypto wallet. 

The Public key is connected to your wallet address, allowing you to share the address with others to receive cryptocurrency, while the private key is known to only you and is what you will use to approve outgoing crypto transactions from your wallet. 

Trading Cryptocurrency on Obiex

Obiex finance website

With the popularity of cryptocurrency trading currently at an all-time high, the biggest challenge for many rookie traders is selecting which cryptocurrency exchange to trade on.

If you fall in this category, the immediate priority should be finding an exchange that allows rookie traders to make trades easily, doesn’t charge extra fees and is completely secure. That exchange is Obiex Finance.

In this guide, you will be shown how to navigate the Obiex mobile app & website easily and what to do to get started with making cryptocurrency trades. 

Getting started with Obiex Finance 

Obiex Finance is a digital asset exchange and financial technology (Fintech) platform that gives its users the ability to easily execute cryptocurrency trades from anywhere regardless of their skill level.

Their commitment to ensuring that users get the best experience is shown in how they allow instant swaps from volatile coins like Bitcoin to stable coins like USDT, and vice versa, without confirmations. In a market where the value of crypto can fluctuate wildly, this feature is especially valuable as it allows users to seamlessly switch between making profits to saving those profits in a more stable currency before the value drops.  

To create an Obiex Finance account, simply head over to their homepage, click on “sign up”, fill in the required fields and verify your email address. After that, create wallet addresses for your crypto assets and you’re ready to start trading!

The cryptocurrency available for trading on the Obiex Finance platform are: Bitcoin (BTC), Ethereum (ETH), Binance Coin (BNB), Polygon (MATIC), Dogecoin (DOGE), Tether (USDT), Binance USD (BUSD), and USD Coin (USDC).

Getting Started with Cryptocurrency trading

After creating your Obiex account, you need to follow these simple steps:

  1.     Have a Trading Strategy: Trading cryptocurrency without having a strategy in place is the easiest way to lose your money. You will need to research the various crypto trading strategies thoroughly and choose the one that best suits your needs and temperament. For example, if you’re a patient person who is content to make smaller, safer trades over a long period of time instead of making riskier trades, then scalp trading is the best trading strategy for you. There are also other crypto trading strategies such as Swing trading, position trading, Arbitrage, dollar cost averaging etc.
  2.     Pick the cryptocurrency you’d like to trade: There are several cryptocurrencies available on Obiex Finance such as Bitcoin, Ethereum, Binance Coin, Tether etc. Selecting which cryptocurrency to trade is usually down to making a choice; whether to stick with the safer, more established cryptocurrencies like Bitcoin or to go with the more volatile coins that have a high upside and an equally high-risk factor like the Dogecoin which can move in either direction based on what Elon Musk tweets.

It is also important to note that when you pick a cryptocurrency to trade, it would be wise to ensure that the cryptocurrency matches the strategy you pick. For example, if your preferred strategy is patient scalp trading, then investing in volatile coins that have a high upside but carry a lot of risk is not the wisest move. 

To swap crypto on Obiex Finance, add the wallet of crypto assets you’d like to swap, send the crypto to the wallet you just created, navigate to the ‘swap’ option on your dashboard, and select the coins you’d like to swap. You will receive the swapped coin in your wallet balance immediately without waiting for network confirmations.

  1.     Securely store your cryptocurrency: The same way you’d protect your goods and profits if you had a physical store is the same way you need to protect your cryptocurrency so it doesn’t fall into the wrong hands.

You can store your crypto securely on your Obiex wallet but if you want an alternative, physical wallets are also an option. Physical wallets allow you to store your crypto in secure hardware, offline storage device reducing the likelihood of online hackers stealing your hard-earned crypto. This is a list of reliable physical wallets you can use.

Conclusion

If you’re a newbie to crypto trading, the keyword is patience. Taking the time to properly understand the market before making trades will stand you in good stead. While risks occasionally pay off, a patient, long-term strategy is required to make consistent profits. For more information about trading as a newbie, you can check this out to understand unfamiliar crypto terms and to learn more about spot trading and futures.

Obiex Frequently Asked Questions | Obiex FAQs

  • Will I be charged a fee when I swap coins on Obiex? 

No you won’t. While other crypto exchanges charge for trades and require confirmations to execute swaps, Obiex allows you to make free, instantaneous swaps without the delay that comes with waiting for confirmation. This also helps you avoid unnecessary losses.

  • Can I trade crypto on Obiex if I don’t know much about crypto? 

Yes, you can! The Obiex Finance platform allows both rookie and experienced traders to make easy, safe trades regardless of trading experience.

  • Can I send and receive crypto easily?  

Yes, you can. To send crypto, you will use your private key to execute outgoing trades and your public key/your wallet address to receive incoming trades. You can also send and receive crypto using just Obiex usernames.

  • Why do I need to swap coins? 

Swapping coins allows you to either acquire a coin you think is (currently) more valuable than a coin you have a lot of. You can also use swaps to ensure that your funds are invested in a more secure coin like USDT if you feel the volatile coin you’re holding is about to go on a bear run and lose value.

  • Do I get a referral bonus when I invite friends to use Obiex? 

Yes, Obiex has a referral campaign that rewards users that invite their friends and family to trade the minimum of $10 on Obiex.

 

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