Blockchain Innovation in Finance: Leveraging Distributed Ledger Technology for Competitive Advantage in Banking and Financial Services

Abstract

This paper explores the current applications of blockchain technology within the financial and banking sectors, with a particular focus on its impact in developing countries like Vietnam. Employing a qualitative research methodology, including synthesis and comparative analysis, the paper clarifies the fundamental concepts, operational principles, and the potential applicability of blockchain in traditional financial systems. Key blockchain applications such as equity crowdfunding via smart contracts, cross-border remittance, decentralized payment services, peer-to-peer (P2P) lending, and supply chain finance are examined in detail. These blockchain-driven innovations are compared with traditional financial models to highlight their advantages in terms of transparency, cost efficiency, and operational efficiency. The findings indicate that blockchain technology not only addresses the limitations of existing financial models but also provides new opportunities for enhancing the competitiveness and sustainability of financial services, particularly in emerging markets. The study offers valuable insights into the future direction of blockchain adoption in finance, while also recognizing challenges that need further exploratio...