Blockchain to rescue lending and crowdfunding activities

In the lending industry, a lender funds a borrower and has considerable risk associated with the borrower (and, to an extent, other counterparties) defaulting. However, visit a website like www.biti-codes.io  to trade in bitcoin with the help of advanced AI technology; the platform is suitable for even novice traders. For this reason, lenders often rely on third-party data and support providers to mitigate this concern.

Alternative finance companies and tech corporations like Amazon are pushing into the lending space because it is such a profitable market with high margins.However, blockchain technology may offer one solution for this situation.

Information sharing:

Blockchain technology can improve efficiency for information-sharing between parties by syncing data across all systems on any given centralized database rather than relying on intermediaries who often have conflicts of interest. In addition, some startups aim to decentralize the lending process by using smart contracts in an oracle framework.
In other words, if you are a lender and want to connect with a borrower, you can create a smart contract that gives the lender specific parameters for which data points to share based on their credit score. Furthermore, it can improve the efficiency and transparency of the transaction for both parties because the information is shared via blockchain technology.

Some argue that companies could eventually use intelligent contracts for other types of transactions than lending agreements. For example, funds are collected but not dispersed in crowdfunding platforms until backers confirm they received their promised rewards.

How Can Blockchain Make Crowdfunding Platforms More Efficient

Though blockchains have the potential to help make crowdfunding platforms more efficient, they have the added benefit of applying transparency and security to the process. It means that backers will be much more comfortable giving their information to a central web service that may be compromised at some point in the future. Therefore, blockchain technology has the potential to transform crowdfunding into an entirely new industry.


 It will probably be relatively easy for consumers to find which services are using blockchain technology or track how those services communicate since all transactions will be visible on a public ledger. Instead of just backing a project, supporters will be able to follow the steps before the company delivers on their promises. This level of transparency is already considered a given in crowdfunding, but it may be possible to establish trust through blockchain technology.
On the other hand, some are already questioning whether or not blockchain will even have many benefits for crowdfunding platforms because it is not set up to handle periods of high traffic like other systems that have been used for decades.

In addition, trust is still necessary for this system to work. The greatest weakness with blockchain technology is human error or simple negligence because blockchains cannot oversee or correct their own mistakes.

Intellectual Property Isn’t Protected On Crowdfunding Platforms:

There may be some situations where it is better to keep certain information private, but the crowdfunding industry is one area where the opposite seems true. On many platforms, backers are encouraged to share their personal information to receive rewards for funding a project. However, this type of activity can lead to companies claiming ownership over their users intellectual property without compensating them for their work.

Even if you receive a token reward instead of cold hard cash, you still own your intellectual property because you could directly influence the product or service that was created by companies, which may help generate future sales. Therefore, investors must be compensated by people for their work because they had a meaningful impact on the final product.

While most of the time, it is companies claiming ownership over a product or service, there are a few cases where blockchain users requested to patent the intellectual property. This type of system may become more common in the future because people are already asking how their ideas can be monetized using blockchain technology.

The Future Of Crowdfunding:

The future of crowdfunding may depend on how well any new blockchain-based services perform because they will likely be held up as examples of how other services should operate. For example, if Amazon raises money on the blockchain and then spends it on a better website, it will be an example of what not to do. But on the other hand, if they do the opposite, they will be held up as an example of what blockchain technology can do.

Any disruption this new generation of services brings may have positive or negative effects on existing crowdfunding initiatives. While it is possible that blockchain technology could transform crowdfunding into something entirely new and different, it is also possible that companies could continue to adapt old concepts for them to work within their own space.

Peer-to-peer lending:

Peer-to-peer loans are growing in popularity because they can help people who have bad credit or have been turned down by banks. In addition, there is a lot of interest in peer-to-peer lending because it has helped thousands of people resolve their financial problems. As a result, the marketplace for this type of service is increasing and has become one of the fastest-growing competitive markets in the world.

Traditional banks are concerned about the growth of peer-to-peer lending because it threatens their business model by offering a new alternative for consumers who may not be able to borrow from them. However, developments like peer-to-peer lending also have some risks that borrowers must understand before signing up.

Click here to read full news..