The growing usage of blockchain technology in financial transactions and cryptocurrencies

Abstract

Blockchain, as a new technology, develops rapidly in the recent years and are used in various fields, especially in finance industry. This paper reviews the advantages and shortages of blockchain as well as the application of blockchain in finance industry, including the underlying technical architecture of the financial industry based on blockchain technology, digital currency, smart contract and financial institutions based on blockchain technology. Moreover, this paper discusses the development of blockchain finance, the factors which impacts on the development blockchain finance and the difference between blockchain finance in China and that in US. Base on the linear regression analysis, we know the relationship between year and the size of blockchain finance which will get 213944 megabytes in the next year. We also find the result that the number of patent and GDP have significant impact on the size of blockchain finance but the number of blockchain corporation and the venture capital of blockchain corporation not, which means people should more focus on the technology development and the total financial environment, rather than investing or setting up blockchain companies blindly because of popularity. At last, we compare the size of blockchain finance in China and in US. The conclusion we make is that the size of blockchain finance in US is still larger than the size of blockchain finance in China, though it develops faster in China in the recent years. Therefore, China still need to learn the knowledge and experience about blockchain finance from US in few years.