BLOCKCHAIN BASED TRANSACTION & SETTLEMENT SYSTEM

BLOCKCHAIN-BASED TRANSACTION & SETTLEMENT SYSTEM

Abstract

Blockchain is built on the bitcoin concept which ensures a common currency for the exchange of transactions. This eliminates the need for exchange rates of various currencies making it fast and also uses secure encryption to ensure transaction blocks are indisputable and accurate. This allows the system to maintain a simple transparent transaction with the need-to-know basic information conveyed. Also, end users are saved from the transaction charges and exchange rate loss that are part of international transactions. This kind of transaction system allows for 2 parties to ensure a secure and successful transaction without incurring any intermediate transaction costs. The system is built on a framework that is a distributed ledger rather that a common centralized ledger which can not be modified backward and needs the permissions of all involved nodes to add a new transaction to it. All it consumes is the computing power of involved nodes. For transaction settlements in the case, an international transaction is to be refunded there is no guarantee you will receive the same amount you uploaded due to fluctuating currency exchange rates. For higher amount transactions even full refunds incur heavy losses due to fluctuating rates. The blockchain-based system allows for easy and full exact-amount refunds as per settlement terms to ensure a transparent and secure transaction and settlement system.

BLOCKCHAIN-BASE DEDUCTION

1.1 Background

The act of exchanging goods and services is an old and enduring venture. The fact that man cannot satisfy his own needs all by himself has necessitated the need to trade. Trading has evolved from its primitive stages to a more advanced and sophisticated form. One of the primitive forms of trade is trade by barter. The trade by barter preferred to some extent the necessary solution to the problem exchange; it, however, has so many inadequacies attached. The problem of mutual coincidence of wants among others is a major setback to the development of the system. The advent of the paper cash system was a breakthrough in the system exchange (trade) as paper cash possesses certain properties (homogeneity, portability malleability), is backed by the government and the central bank is a  legal tender for exchange. The paper cash system indeed contributed enormously to the ease with which trade is being carried out (Ballou, 2019).

The landmark achievement however in the areas of electronics, computers, and information technology coupled with the need to carry out transactions at a very fast rate has paved the way for the digital cash transaction system. The digital cash transaction system evolved after the paper cash. It involves the use of digital pin codes to represent paper cash with transactions carried out on this basis. More technically, a digital cash transaction system is a payment or withdrawal message bearing a digital signature (pin code) and its function as is medium of exchange (trading). With the increased traffic of banking transactions, and frauds such as card skimming, and card theft which have increased excessively in recent years, blockchain technology has emerged as an effective means of online payment method. Blockchain technology initially associated with virtual currency has quickly gained prominence in different other areas of life. Without the need for a controlling entity, transactions can be initiated and validated on the blockchain. This features its unique selling point. To this end, studies have identified blockchain technology as possessing the potential to address the problem of fraudulently banking transactions adequately.  Hence, this study intends to design a Blockchain  Transaction & Settlement System.

• Problem Statement

Money in all its various forms since its invention has always been faced with security problems. The digital cash transaction system through a cutting-edge innovation as far as the technology of money is concerned is not spared of this dilemma. Specific issues relating to the security of the system that needs to be addressed are;

1. Illegal access to the financial data of individuals by hackers
2. The problem of unencrypted files creates security loopholes in the current cash transaction system.
3. The existing. physical cash system is subject to physical damage as someone can lose his money without actually spending it

As a result of the above problem, this study intends to develop a Blockchain-Based Transaction & Settlement System.

 

1.3 Study Objectives 

The general aim of this project is to design a blockchain-based transaction & Settlement System.  The specific objectives include:

1. To develop an application that will use blockchain technology to secure data storage in banking databases and curb fraud.
2. To test the success of the proposed banking blockchain application.

 

1.4 Significant of the Study

The proposed system will be of great benefit to businessmen and it will improve the managerial cum administrative strength of the business and move the business forward to meet the demand of times and globalization in this era of technology. It provides an easy record of goods and proper identification of sales. This piece of work will add to the already existing literature review and act as a reference work for future researchers.

 

1.5 Scope and Limitation

The purpose of this research is to create an application using blockchain technology that addresses information security as well as secure online payment transactions using blockchain technology. The system provides a private, secure, untraceable, decentralized digital currency. You are your bank, you control your funds, and nobody can trace your transfers unless you allow them to do so.

 

BLOCKCHAIN-BASED TRANSACTION & SETTLEMENT SYSTEM. GET MORE BLOCKCHAIN PROJECT TOPICS AND MATERIALS

 

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