Beyond Bitcoin: How Developers are Helping Traditional Banks Modernize: A collaboration with Indexcode.io
Nov 28,2019 · 5min read · 886 views
Bitcoin and blockchain tend to grab headlines in the world of banking. Cryptocurrency is the poster child of “disruptive technology” in the traditionally slow-moving finance industry. But, there are other areas where developers and software engineers must update business-as-usual in banking in order to survive.According to one survey, 80% of bankers agreed that their institution “needs to complete an assessment over the next three years, but only 15% expected that to lead to a modernization effort.” Security threats, the demand for mobile banking, and outdated core banking systems are all driving banks to consider massive overhauls to their IT systems. These are the biggest modernization challenges facing financial institutions – areas where developers and remote software teams can play a significant role in keeping banks competitive.
Making updates to “legacy structures”
In the same survey, 60% of bankers reported that at least one of their major technology challenges is directly tied to aging core systems. “Maintaining legacy systems accounts for 78% of a bank’s IT budget, and 70% of bankers feel their core processes cannot quickly adapt to change,” reports Ripple. Over time, banks have resisted major changes to their core banking system, the backend system responsible for processing transactions, updates to accounts, and maintaining other financial records. Core banking systems are in charge of processing deposits, loans, and posting credits, as well as updating other reporting and ledger tools. As consumer-driven capabilities like mobile deposit and peer-to-peer transfer have grown, these core banking systems have had ad hoc updates – but no complete transformation. Core deposit systems were built in the 1970s, written in “old, inflexible programming languages” like Cobalt and PL/I. Oracle’s analysis also found that these “decades-old legacy core systems are inflexible, and each time a bank wants to launch a new product, they must ‘hard-code’ the system, which can take 12 months or more.” There’s no simple solution to updating a bank’s core system: it’s a massive technological undertaking, but one that banks must invest in to serve its customers well. Engineers can help banks develop an agile, consumer-centric approach to core banking. There are multiple approaches to solving the problem of archaic core systems, and software teams can phase in iterative changes that evolve a bank’s core infrastructure without too much service interruption.
Modernizing Fraud Protection
Fraud prevention remains one of the most difficult technological challenges facing banks as cybercriminals get more sophisticated in targeting consumers. To illustrate the challenge banks face in keeping consumer account information safe, Kasperky Lab hacked a “large, publicly-traded financial company in less than 15 minutes.” The traditional approaches many banks have taken do not work. Authentication requirements and verification processes fail to prevent fraud and provide a negative customer experience. Instead, writes one security expert, “banks should focus on creating better systems and techniques to collect and analyze internal and external data, develop more meaningful algorithms and profiles, execute penetration testing against current strategies, detect changes in transaction patterns and develop more effective solutions.” To protect consumers from malware and fraud attacks, banks must shift from a reactive to a preventative operations approach. Developers can help banks prepare by modernizing the systems that store user data, moving information onto an encrypted cloud. IBM’s AI tool, for example, is said to offer a faster analysis of advanced persistent threats and attacks. Developers must integrate the latest technology into banks’ security systems to modernize. Digital account openingDevelopers will play a critical role in helping traditional banks keep up with the demands of customers on-the-go. Digital account opening is one process where developers and software engineers can have an immediate impact. Digital account opening (DAO) is the process of opening a bank account without ever stepping foot inside a bank. DAO involves taking the following steps:
Collect a customer’s personal identification information
Evaluate and approve (or reject) a customer from a risk/fraud perspective
Verify the customer’s identity
Accept funds digitally and immediately, either through a debit/credit card or with mobile deposit
Sync with the core banking system
Many banks are capable of letting customers open an account online through a web browser. Yet, mobile-optimized account opening is an area where the industry has lagged behind. There are some very good reasons why this process is so difficult. Application fraud and strict anti-money laundering laws make it difficult for banks to meet regulatory requirements. An, there are significant security risks: in 2018, banks faced a more than $31 billion in global fraud loss. But developers who help banks modernize to provide DAO will have an immediate financial impact. One report found that 69% of those surveyed wish to perform all their banking through online and mobile channels. BAI found that around 75% of millennials and more than 65% of Gen Xers prefer to use a digital channel to open a deposit account. The core consumer of the future will expect to be able to open an account, take out personal loans, and transfer funds from any device at any moment. Developers must find a way to build the infrastructure to allow banks to offer DAO.
See the full article: https://www.indexcode.io/post/beyond-bitcoin-how-developers-are-helping-traditional-banks-modernize
3 Coins To Watch Once The Market Turns Green Again
Aug 02,2018 · 6min read · 1021 views
By: Ermos Kyriakides
The market is bleeding. There is blood on the streets. People are panicking. If you want to read my thoughts on how I think this will play out, check out one of my previous blog posts “There’s Blood On The Streets — What Now For Cryptocurrencies?” which you can find here (still applies today).
Despite the bleeding market, not everything is doom and gloom. The technology that will revolutionize our lives still exists and is thriving. There are a number of projects that have progressed significantly during this downturn and the positive news have been overshadowed.
In this post, I will be talking about 3 coins that have had important developments over the past few weeks. You should definitely keep an eye out for these once the market recovers.
The Binance Exchange was launched mere months ago (July 2017). Since then, it has managed to solidify itself as one of leading Cryptocurrency Exchanges out there, in terms of, professionalism, trading volume, security, user experience and so much more. It also runs very successful competitions and is pro-active to project forks and airdrops — something not many exchanges can boast.
Binance not only runs a very successful exchange but has also launched a number of other platforms, such as, the Binance Labs (a blockchain technology incubator), Binance Info (a Codex), and others which make up the Binance Ecosystem.
A little known fact is that Binance, has its own coin called the Binance Coin(BNB). BNB can be used by participants to reduce transaction fees, used as trading pair and also as a currency on their various platforms. BNB is about to become much more important.
As a public blockchain, Bianance Chain will mainly focus on the transfer and trading of blockchain assets, as well as provide new possibilities for the future flow of blockchain assets. Binance Chain will focus on performance, ease-of-use, and liquidity. Binance Coin (BNB) will be upgraded to exist on its own blockchain mainnet, becoming a native coin. At the same time, Binance will transition from being a company to a community.
In other words, Binance is aiming to launch their own Decentralized Exchange (DEX) aiming for the likes of Ethfinex, IDEX and others. You might be wondering, why Binance would want to launch a competitive product to their own Centralized Exchange. In their own words — “Centralized and Decentralized exchanges will co-exist in the near future, complementing each other, while also having interdependence”. You can find more information about the Binance Chainhere.
Details on what exactly the Binance Chain will look like are vague, but if they follow a similar approach as other DEXs, expect BNB holders to receive dividends based on transaction volume on the exchange and potentially a reduction in fees. Once the markets turn around, BNB’s true investing potential will surface.
The Binance Coin (BNB) can be, unsurprisingly, purchased on Binance.
"Aragon is a project that aims to disintermediate the creation and maintenance of organizational structures by using blockchain technology. We want to empower people across the world to easily and securely manage their organizations. We provide the tools for anyone to become an entrepreneur and run their own organization, to take control of their own lives. By making it possible for everyone in the world to organize, we are enabling a borderless, permissionless and more efficient creation of value. "
Aragon is building a platform where anyone can launch a DecentralizedAutonomous Organization (DAO). In short, in a DAO everything is recorded on the blockchain. This includes, the structure of the company, voting rights, roles, accounting and more — this makes the organization fully transparent.
While the market has been bleeding for the past few months, Aragon has continued to work relentlessly and recently released The Architect — Aragon Core v0.5 on the Rinkeby Ethereum Testnet. Aragon plans to release The Architect on the Ethereum Mainnet in the next couple of months, subject to a second external independent audit and bug bounty campaign.
The Architect is a huge step forward in Aragon’s roadmap (and the cryptocurrency space) and will unshackle a number of Decentralized Applications (dApps) relying on Aragon; i.e. Auctus, district0x and more. You can find more information on The Architecthere. Although this release has gone largely unnoticed in the cryptocurrency community, once the market starts to recover, the importance of this release will become very apparent.
Besides the exciting release of The Architect, they have also published a brilliant video highlighting how Blockchain and DAOs will empower the future which I urge everyone to watch.
OmiseGO is building a decentralized exchange, liquidity provider mechanism, clearinghouse messaging network, and asset-based blockchain gateway. OmiseGO is not owned by an single one party. Instead, it is an open distributed network of validators which enforce behavior of all participants.
Over the past few weeks OmiseGO has had a wave of positive news which I expect to be fully appreciated once the dark clouds over the cryptocurrency market have gone away. These include:
Cosmos Hard Spoon — Essentially this is a new blockchain which takes into account the state of an existing chain. Quoting Vitalik Buterin (Ethereum Co-Founder): “A hard spoon is a meta-protocol on top of a blockchain creating a token that inherits the blockchain’s underlying token’s balances.”. You can find more information about the hard spoon, here.
Massive Partnership — On the 5th of April, Omise & OmiseGO signed a Memorandum of Understanding (MoU) with ShinhanCard, an affiliate of the Shinhan Financial Group, a major player in South Korea’s banking and payments sector. For more information, check out their official announcement, here.
OmiseGO eWallet SDK — The OmiseGO team has shared the repositories for the OmiseGO eWallet, in addition to a number of SDKs. This will enable eWallet providers to start the on-boarding process and brings us one step closer to the full white label wallet release. You can find more information on these news, here.
If you want to read more about OmiseGO, the team has created a brilliant guide, which you can find here.
To conclude, these are just 3 projects out of many, with significant developments that have gone under the radar due to the market conditions. We should all keep an eye out on these projects, as when things start to turn around (and they will) these projects will have hit their roadmap milestones and be in prime position to “capture the bounce”