As a fin-tech company, iuvo is in deep touch with the latest technological developments in the field. Today we`d like to talk about something a bit outside of what we do, but still vital and related to it – blockchain and cryptocurrencies.
Blockchain and Cryptocurrencies
Perhaps you`ve heard of blockchain, but can`t really understand the point behind it. Simply put, it is a shared online ledger that is updated instantly after the information is input and can`t be altered afterwards. It`s a completely new and transformative way of information sharing. A good way to think of it is like a huge Excel spreadsheet that can contain all sorts of information, regarding transactions, deals, sales of assets and almost everything else. This makes it a perfect tool for ensuring the transparency of any transaction and that`s precisely why it`s so valuable when it comes to online investments. Because of the shared and distributed essence of the system, anyone can access it and verify if a transaction occurred or not, there is no way to forge it.
From the abovementioned factors, you can understand why blockchain can be important to the trading of any good or asset online. This naturally leads us to the next point of discussion – cryptocurrencies. A cryptocurrency, as the name suggests, is a virtual currency, secured with cryptography and unrelated to any government or institution. The only factors at play are the free market and the users. As you surely know, the most popular cryptocurrency is Bitcoin, but there are also others like Ethereum, Litecoin and Dogecoin.
P2P and Blockchain
P2P lending is a system which enables individuals to borrow and lend funds directly from each other, bypassing traditional financial institutions like banks. It is a process that removes the middle man and addresses many of the issues associated with traditional borrowing and lending. In the case of iuvo, we are talking about investing in P2P loans and making profit on the interest rates that are accumulated by the lender.
Naturally, there are other challenges that arise with P2P lending, like the guarantee for safety and transparency and this is exactly where blockchain can come in handy. It has the power to transform industries and P2P has much to gain from it, especially by helping to remove some of the intermediaries in the process.
There are three main aspects that blockchain can improve in P2P:
1. Cost – it can connect borrowers and lenders much more quickly.
2. Time – by removing some of the steps, the process can become more efficient and less time consuming, eliminating delays and allowing for quick loan approvals.
3. Transparency and safety – the shared and open nature of blockchain makes the whole process more secure and open, so even if there are third parties involved, they could not affect the transaction after it`s done.
Where it`s all going
With increasingly more intense discussions regarding the regulation of crypto and more government institutions trying to get involved in the process, many investors are becoming more confident about putting their trust in it. Possible future regulation can surely drive more traditional investors to try crypto, which in turn can result in an overall rise in trust towards such opportunities, including P2P.
There is certain mistrust that can be seen towards the newer investment methods powered by tech, but that is slowly changing. An overall positive perception towards cryptocurrencies will surely have a good impact on P2P and there are already lending platforms that are including Bitcoin as part of their service.
To sum it up, it is all connected. Uniting the transparent nature of blockchain and the direct nature of P2P can transform the whole process of money lending and borrowing, making it better for everyone involved. We can`t wait to see what the future holds for the industry and iuvo alike!