Blockchain offers four major advantages compared to traditional data structures.

1. Security

Blockchains are secured by a network of many computers, which work as nodes and verify transactions. This significantly increases security since there is no single point in the network that can cause a network failure.

Another security aspect is the immutability of the blockchain data. Every centralized database can be corrupted and usually needs a trusted third party for transactions in order to keep information accurate. The consensus approach of the blockchain allows immutable transaction without the necessity of a trusted third party.

2. Velocity

Depending on its structure, changing a database can take quite a lot of time. Different financial transactions can take up to a few days, e.g. until the settlement is confirmed. Time consuming verifications, which usually need a trusted third party, e.g. a bank, kann be done within minutes via blockchain. This not only saves time, but also high costs for all participating parties. This is one of the main reasons why the financial industry is one of the most active in the blockchain field.