The blockchain as a technology of increasing trust and reducing transaction costs in the financial sector

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Journal paper

Russian Journal of Innovation Economics ^{(РИНЦ, ВАК)}
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Volume 9, Number 3 (July-September 2019)

Citation:

Indexed in Russian Science Citation Index: https://elibrary.ru/item.asp?id=41263377
Cited: 9 by 07.08.2023

Abstract:
The approach to blockchain only as a new technology, the security of which raises many questions, seems rather narrow. The experience of using blockchain in the financial sector shows the broad possibilities of this system to significantly reduce transaction costs by increasing the level of trust between economic agents who use it for transactions. The level of trust in the use of blockchain in the financial sector is increased due to the ability to ensure the reliability of verification of assets (property, capital), storage of transaction records, ensuring reliable data storage and cost reduction. Trust is a factor that determines the level of transaction costs in the economic system and, ultimately, the efficiency of the economic system, the prevailing forms of business organization and business processes. Trust is a component of social capital and has a stimulating effect on the efficiency of the national economy. Cross-country comparisons show that countries with higher levels of confidence show higher GDP and investment growth. Thus, the blockchain acts as a factor of increasing confidence and on this basis the growth of macroeconomic indicators, in particular GDP, the share of investment in GDP.

Keywords: trust, institutions, transaction costs, cryptocurrency, blockchain

JEL-classification: O31, O33, O32, F33

References:

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