The Impact of Blockchain Adoption on Financial Performance in Fintech Firms: A Review of The Literature
DOI:
https://doi.org/10.54097/fbem.v11i2.12627Keywords:
Blockchain adoption, Fintech firms, Financial performance.Abstract
This write-up explores the impact of blockchain adoption on financial performance in fintech firms. Fintech's integration of blockchain technology enhances revenue, reduces costs, and augments competitiveness. Key findings reveal revenue growth through asset tokenization and efficient cross-border payments. Cost savings arise from intermediary removal and smart contract automation. Fintech firms collaborating with blockchain startups gain market share. Enhanced profitability and risk management are observed. Challenges include scalability, regulatory uncertainty, and interoperability issues. Limited long-term data availability and industry-specific variations pose limitations. Implications suggest further research into long-term effects, subsector-specific investigations, and comparative analyses. Fintech firms are encouraged to strategically adopt blockchain while emphasizing compliance and risk management.
Downloads
References
Ghiro, L., Restuccia, F., D'Oro, S., Basagni, S., Melodia, T., Maccari, L., & Cigno, R. L. (2021). What is a Blockchain? A Definition to Clarify the Role of the Blockchain in the Internet of Things. ArXiv preprint arXiv: 2102.03750.
Thakor, A. V. (2020). Fintech and banking: What do we know?. Journal of Financial Intermediation, 41, 100833.
Chen, Y., & Bellavitis, C. (2020). Blockchain disruption and decentralized finance: The rise of decentralized business models. Journal of Business Venturing Insights, 13, e00151.
Juan, A. A., Perez-Bernabeu, E., Li, Y., Martin, X. A., Ammouriova, M., & Barrios, B. B. (2023). Tokenized Markets Using Blockchain Technology: Exploring Recent Developments and Opportunities. Information, 14(6), 347.
Tian, X., Zhu, J., Zhao, X., & Wu, J. (2022). Improving operational efficiency through blockchain: evidence from a field experiment in cross-border trade. Production Planning & Control, 1-16.
Jensen, J. R., von Wachter, V., & Ross, O. (2021). An introduction to decentralized finance (defi). Complex Systems Informatics and Modeling Quarterly, (26), 46-54.
Carter, N., & Jeng, L. (2021). DeFi protocol risks: The paradox of DeFi. Regtech, Suptech and Beyond: Innovation and Technology in Financial Services” RiskBooks–Forthcoming Q, 3.
Zarrouk, H., El Ghak, T., & Bakhouche, A. (2021). Exploring economic and technological determinants of Fintech startups’ success and growth in the United Arab Emirates. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 50.
Wang, Q., Lau, R. Y. K., & Mao, X. (2019). Blockchain-enabled smart contracts for enhancing distributor-to-consumer transactions. IEEE Consumer Electronics Magazine, 8(6), 22-28.
Sonawane, S., & Motwani, D. (2023). Modelling blockchain technology-driven practices to be integrated in fintech for creating reliable business processes. Scandinavian Journal of Information Systems, 35(1), 205-220.
Cuccuru, P. (2017). Beyond bitcoin: an early overview on smart contracts. International Journal of Law and Information Technology, 25(3), 179-195.
Lukonga, M. I. (2018). Fintech, inclusive growth and cyber risks: Focus on the MENAP and CCA regions.
Unal, I. M., & Aysan, A. F. (2022). Fintech, digitalization, and blockchain in Islamic finance: Retrospective investigation. Fintech, 1(4), 388-398.
Cai, C. W. (2018). Disruption of financial intermediation by Fintech: a review on crowdfunding and blockchain. Accounting & Finance, 58(4), 965-992.
Mărăcine, V., Voican, O., & Scarlat, E. (2020, July). The digital transformation and disruption in business models of the banks under the impact of FinTech and BigTech. In Proceedings of the International Conference on Business Excellence (Vol. 14, No. 1, pp. 294-305).
Gomber, P., Koch, J. A., & Siering, M. (2017). Digital Finance and FinTech: current research and future research directions. Journal of Business Economics, 87, 537-580.
Pollari, I. (2016). The rise of Fintech opportunities and challenges. Jassa, (3), 15-21.
Sonawane, S., & Motwani, D. (2023). Modelling blockchain technology-driven practices to be integrated in fintech for creating reliable business processes. Scandinavian Journal of Information Systems, 35(1), 205-220.
Singh, R., Malik, G., & Jain, V. (2021). FinTech effect: measuring impact of FinTech adoption on banks' profitability. International Journal of Management Practice, 14(4), 411-427.
Gruchmann, T., & Bischoff, O. (2021). Blockchain-driven handling of digital freight information: a tensions perspective. Logistics Research, 14(1).
Stulz, R. M. (2019). Fintech, bigtech, and the future of banks. Journal of Applied Corporate Finance, 31(4), 86-97.
Leong, K., & Sung, A. (2018). Fintech (Financial Technology): What is it and how to use technologies to create business value in fintech way? International Journal of Innovation, Management and Technology, 9(2), 74-78.
Mosteanu, N. R., & Faccia, A. (2021). Fintech frontiers in quantum computing, fractals, and blockchain distributed ledger: Paradigm shifts and open innovation. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 19.
Mazlan, A. A., Daud, S. M., Sam, S. M., Abas, H., Rasid, S. Z. A., & Yusof, M. F. (2020). Scalability challenges in healthcare blockchain system—a systematic review. IEEE access, 8, 23663-23673.
Javaid, M., Haleem, A., Singh, R. P., Suman, R., & Khan, S. (2022). A review of Blockchain Technology applications for financial services. Bench Council Transactions on Benchmarks, Standards and Evaluations, 100073.
Al-Rakhami, M., & Al-Mashari, M. (2022). Interoperability approaches of blockchain technology for supply chain systems. Business Process Management Journal, 28(5/6), 1251-1276.
Li, X., & Wang, C. A. (2017). The technology and economic determinants of cryptocurrency exchange rates: The case of Bitcoin. Decision support systems, 95, 49-60.
Amir Latif, R. M., Hussain, K., Jhanjhi, N. Z., Nayyar, A., & Rizwan, O. (2020). A remix IDE: smart contract-based framework for the healthcare sector by using Blockchain technology. Multimedia tools and applications, 1-24.
