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Blockchain technology has been making in-rows into the global financial sector for quite some time now, with major banking institutions and even some national governments looking to explore the untapped potential of blockchain implementation. It’s a well-known fact that blockchain has been transforming the way we raise money, transact money and make payments in a number of different ways.

Although cryptocurrencies have been a highly debated subject among financial experts and regulators, the underlying blockchain technology has the potential to be used for a variety of use-cases across different industries, and the banking sector is no different. Well thought-out projects like BANKEX, ChronoBank and Casha have already started to bridge the gap between traditional banking institutions and their users. However, Luxcore is another similar project, but with some salient features that dwarf its competitors by a huge degree.

Understanding Luxcore

Luxcore was founded with the aim of using blockchain technology to build a trust-less, paperless and secure economy for the future. The project, headed by CEO John McAfee already has a certain amount of credibility attached to it.

Luxcore aims to provide a set of unique protocols as well as tools for easy integration across a myriad of businesses and industries which require secure intra-organisational blockchain networks.

How Luxcore Can Disrupt The Global Banking Industry

Luxcore aims to provide legitimacy of any transaction within the banking sector through two of their unique products, namely, LuxGate and the PMN private network.

LuxGate: LuxGate is the key catalyst that drives the Luxcore ecosystem forward. In layman’s terms, LuxGate is a cross-blockchain unifying bond that bridges the gap between two different ecosystems. It makes use of the parallel masternodes functionality of Luxcore to make this possible. Through LuxGate, users on the Bitcoin blockchain will be able to engage with the Ethereum blockchain or any other network for that matter.

PMN or Parallel Master Nodes Network : This feature enables Luxcore to address the needs of global enterprises and institutions in a reliable, secure and foolproof way. It is developed on top of the famed i2pd Technology and the SAM protocol for achieving a higher degree of security. To make this only suitable for legitimate uses, this feature will only be available to those businesses and institutions which are verified and vetted in addition to government institutions.

The Role of LuxGate and PMN Networks in Banking

Luxcore aims to disrupt all facets of the existing banking sector, through the collaborative efforts of both LuxGate and PMN networks. Both the features can work together and in tandem to strengthen the two layers of differing safety algorithms. When these two systems work together, it allows the easy deployment of permissioned blockchain networks while also facilitating interoperability in a secure way.

The global banking industry is estimated to be in an excess of 150 Trillion Dollars in the present day, and a secure way of sending information without third-party intervention is a necessary measure. Projects like Luxcore take the initiative to use blockchain automation to complete many of these tedious processes, without any outside interference.

Features of the project

To further understand this, Luxcore will have a major positive impact on five aspects of traditional banking, namely Clearance and Settlements, Payments, Fundraising, Securities and Loans & Credit.

Clearance and Settlement Systems

Existing bank transfer systems, built around a traditional financial infrastructure are plagued with issues such as delays due to logistical difficulties. This is because of the presence of a complicated system of intermediaries which includes different custodial services; Luxcore aims to change this by reducing operational costs and assisting real-time transactions through distributed ledger technology.

Payments

It is estimated that trillions of Dollars get stuck on the global banking system due to an antiquated system of delayed payments as well as recurring fees. Normally, the typical cost of transactions is approx. 7.6% of the transaction value caused by incremental wire fees, or hidden exchange rate markups. This is however profitable for traditional banking systems while amounting to huge losses for the end user. Luxcore, by eliminating the need to rely on intermediaries for transaction approvals, would facilitate much faster payments, at much lower fees than present banking systems.

Fundraising

Fundraising through traditional methods such as raising venture capital is an arduous and painstaking task, with no guarantee of an end product. This has dramatically changed with the influx of cryptocurrencies in the market, which uses a method called Initial Coin Offerings. Keeping with the changing trends of fundraising in the world, Luxcore aims to use blockchain technology to eliminate the need for any intermediary platform to make the system “open, distributed and liquid”.

Securities

Current methods of acquiring or selling securities such as stocks, debts commodities, etc. are riddled with complex chains of brokers, exchanges, clearing houses, custodian banks, and central security depositories. Certain plaguing issues such as outdated systems of paper ownership can further make this process slow and complicated. Through blockchain technology, however, Luxcore can create a decentralized database of digital assets, transferring ownership rights through tokens.

Loans & Credit

Inaccurate and insecure systems of credit reporting have caused major financial upsets in the past, all the while making the process slower. There are also major credit agencies that are in charge of an individual’s credit report such as Experian and TransUnion to name just a few. This centralized system often ends up being detrimental to the interests of consumers, negatively impacting their chances of getting a loan. Luxcore, through the use of smart contracts, can offer a cheaper and more efficient system of making loans available to a larger pool of consumers. By maintaining a decentralized registry of historical payment records, an individual’s credit score is correctly calculated and saved.

Final Thoughts

With a major shift towards blockchain integration in the banking system, the world is indeed moving towards a trust-less economy. The landscape of blockchain technology has thus experienced tremendous technological advancements over the past few years. Projects like Luxcore only push the boundary forward, alleviating much of the monetary losses of consumers while making it a foolproof system at the same time.