Analysis of the Application of Blockchain Technology in Banking
Jiawei Zhang · Frontiers in Business Economics and Management · 2025
This paper discusses the application of blockchain technology in the banking industry, highlighting its role in business upgrading, restructuring, and addressing various challenges. Blockchain technology provides a decentralized KYC process, enhances transparency and security in shareholding management, and facilitates the establishment of a decentralized governance structure within banks. It also introduces operational efficiencies by automating processes and integrating data verification into transaction processing. By ensuring data truth and integrity, blockchain reduces fraud risks and bolsters customer trust. However, it poses challenges in data correction and regulatory uncertainty. While blockchain technology optimizes payment and settlement systems, reduces transaction costs, and enhances operational efficiency, it also undermines traditional banks' intermediary revenue streams and dominant position. Integrating blockchain technology into existing banking operations requires overcoming technical complexities, appropriate technical skills, and cultural changes. Despite these challenges, blockchain technology creates a sound environment for product innovation, achieves resource sharing and innovative collaboration, and will help the financial market in its digital transformation and smart upgrading. Banks must work with regulators to craft clear regulatory frameworks and policies that foster innovation while ensuring safety and compliance.