Blockchain has value, but more study is needed

Blockchain has the potential for enhancing the security of financial transactions, but there are also wide ranging issues to be addressed, particularly for regulated institutions like credit unions.

Originally an element of bitcoin, this emerging technology is a distributed, peer-to-peer database that maintains a continuously growing necklace of transaction records, thus creating a solid wall against fraud and abuse.

A blockchain includes two types of records, transactions and “blocks” – transactions include the actual data, such as credit card information stored in the blockchain, and the blocks act as sort of time stamp confirming exactly when and in what sequence transactions have occurred. As new blocks are added like a necklace, the blockchain continues to grow in a linear, chronological fashion, yielding a complete, historically accurate database of all transactions.

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