February 21, 2017

Blockchain Solutions in the Financial Industry

In this blog post, we will explain how a technology in its infancy, which is the Blockchain, could find solutions for one of the most well-established industries, which is financial industry.
From issues of regulation, trust, funding, miseducation; the battle of the millennials’ technology towards implementation is proving successful so far, but we have to ask ourselves two questions:

  • What is the financial industry's outlook on transparency and trustlessness?
  • What can we do to change that outlook? (Without losing the main components of the Blockchain)

The Current Landscape:

Most people in the blockchain industry believe that its implementation at this stage is virtually impossible. Banks are central. They have remained that way, successfully, for centuries now. Paraphrasing Chris Stewart, the CEO of SuredBits: “For a technology that defies everything that a bank is built on, to swoop in and chanwge the identity of a large, bureaucratic institution, the changes have to prove to not be destructive for the current setting which financial industries are built on.”

Arguably the financial industry, mostly banks, see this as a threat against the power they have. The blockchain is a people’s technology, in the sense that transparency is where the name of the game is. If banks can control everything they have without the use of transparency, why would they?
Yes, we do see fundings going everywhere towards this technology and proof-of-concepts are being developed at a quick pace, but are these fundings well-intended?

Our opinion on this matter is dualistic. Banks could either look to destroy the Blockchain’s image, through bad endorsement/publicity, or they could embrace the technology, but look to strip away the main concepts that build the Blockchain; like its decentralization, its transparency (this is a key point), and leave us with a technology that wasn’t the idea in the first place.

There is a third option: We find a middle-ground where the banks still have control over their services but the processes that the Blockchain is looking to enhance are augmented.

The Promising Future and Bitsapphire’s Efforts

As a company that develops blockchain solutions, our primary goal is to find ways to penetrate the industry with as little disruption as we can. Finding proof-of-concepts that conform to the investors, in the meanwhile suggesting innovative ideas that prove beneficial to the sectors in financial services.
In this post, we will explain some common scenarios that may occur during the implementation or your day-to-day confrontation with financial services, why they’re so frustrating, and what we, as a company, are trying to fix.

BaaS (Banking-as-a-Service)

Why are we mentioning Banking-as-a-Service? Taulant Ramabaja, our company’s expert in the blockchain industry, mentioned this term and made it very clear as to how banks were going to possibly expand with the implementation of blockchains. On the other hand, I saw as to why this could also be seen as an issue.

Imagine this scenario. You approach an investor with the idea that you want their banks to hand over the “monopolized” power they currently have, and in exchange, they get to provide services. How would that sound if it were your company? My guess is: “Not that great”.
If on the other hand, we were to approach the investor with the idea that this would allow the expansion beyond what they can and/or currently do, then it's a much better investment idea.

This is where our company’s expertise comes in. Our interest is in providing a universal, quicker service that is also within reach to everyone possible. How would we do this?
We show banks, with Proof-of-Concepts, that if they act as a place where money only “sits”, and every service that they provide could be done through an API, which is thousand-folds easier to expand than their current strategy, then why would they not be interested?

This would provide easier access to the bank's average customer, but also to (potential) customers all over the world, so that they don’t have to run a few miles to the next ATM/Bank for a simple withdrawal. In turn, this would generate more revenue for banks, and more revenue, means better service.

So BaaS is a very central subject in our company’s vision because not only do we provide banks with the opportunity to expand on a grander scale, we also provide you, the customer, with the faster and more accessible service that you deserve.

Blockchain Solutions in the Financial Industry


The loan process is a painful one. It is so long and straining, that people even result to using loan sharks that charge with extremely high-interest rates, just so they can avoid the bank documents that are a required to get a loan.

During our development as a company, we saw a lot of potential for financial services, and loans was one of the top contenders. The current process contains a lot of procedures, from optimizing your credit report, getting a credit score, gathering documentation, deciding whether you want a secure or unsecured loan, paying for fees, and if anything goes wrong this will damage your credit scores unbelievably and might even land you in court.

How does the blockchain industry come to the rescue? If we were to be realistic, the process wouldn’t be eliminated entirely, you’d still have to go through the documentation, but where the blockchain would shine is in expediting the process.

Taulant mentioned that through the use of blockchains, we could save all the data mentioned previously and the accessibility to that data would be much quicker. It wouldn’t have to be done through a government and the bank could simply check and approve.

A default scenario would be: You apply for a loan, you provide some required documents, for example, your ID and proof of ownership, and the bank would check under that ID whether or not you are truly the owner. They access the blockchain, confirm everything, and you’re set. So we eliminate the need to pile up documents on documents and not only would this serve the customer but it would also serve the bank because it’s in their best interest to also serve you with quality and fast service.


Transactions take a lot of time to come through. The current TPS (Transaction Processing System) takes a lot of time, because all the information requested has to be gathered, organized and stored. Not only is the issue in the delay of accessibility, transactions have to be reliable and consistent. The process of securing the data is also costly because they must be saved in databases, warehouses, etc.
This delays the process of a transaction by a mile and it's one of the many reasons why blockchains would be so helpful to not only to customers, but also to banks.

Blockchains, according to Taulant, could be used to store information in a swift (but not SWIFT, unless they want to) and easy manner. Since blockchains are tamper-proof, because of the way it is built, this would mitigate the need to provide a separate, and costly, process of saving and securing information.
The speed of blockchains is beyond what any current services are providing and could speed up the process noticeably.
ICICI Bank of India completed its first transaction outside of the sandbox mode and in a real and present infrastructure for banks, so the future seems to be not so far.

One way we, at Bitsapphire, believe we could improve is in the sector of international transactions. International transactions are painful. Who hasn’t thought about it twice before they decided to pull cash overseas? Bank of America takes 3 percent on purchases or 1 percent plus $5 conversion fee on withdrawals - that’s a staggering amount.

This is because of all the middlemen that have to be used to confirm the transaction. Blockchains can be used to remove the middlemen of the transaction, since all the data for it can be confirmed on a blockchain. This would save the customer, a lot of money but it would also save banks a hefty sum.

Blockchain, Bitsapphire and the Future

The Blockchain Industry and its implementation is not necessarily within just these fields. We believe that as blockchains grow outside its current setting we will find use cases for it that will enhance the customer service that could be provided as well as save money. The win-win situation is necessary in this process because, the customer, doesn’t care about what technology is behind the process, they simply want a smoother and better experience.

We know that and we are working harder everyday to make that happen, but this includes educating everyone around the myriad of possibilities that blockchains provide.