How does blockchain enhance security in financial transactions?

How does blockchain enhance security in financial transactions?

Blockchain enhances security by providing a decentralized ledger that is immutable and transparent, making fraud more difficult.

What makes blockchain different from traditional databases?

Unlike traditional databases, blockchain is decentralized, meaning no single entity controls it, which reduces the risk of data tampering.

Can you explain how transactions are verified on the blockchain?

Transactions on the blockchain are verified through a consensus mechanism, where multiple nodes validate the transaction before it's added to the ledger.

What are the benefits of using blockchain in banking?

The benefits include increased security, reduced transaction costs, faster processing times, and enhanced transparency.

Are there any risks associated with blockchain technology?

Yes, risks include regulatory uncertainty, potential for hacking, and the challenge of integrating with existing systems.