A

PROJECT REPORT
ON

Analysis of Blockchain technology in banking sector:

Applications & transaction validation
Submitted in Partial fulfillment of the
Requirements for the Award of the Degree of

Master of Commerce

By
Swati Suman
Enrollment No. 2019MCOM018

UNDER THE SUPERVISION OF

Dr. Sanjay Kumar Patel
Assistant Professor
DEPARTMENT OF COMMERCE SCHOOL OF COMMERCE AND
MANAGEMENT CENTRAL UNIVERSITY OF RAJASTHAN
 CANDIDATE’S DECLARATION

I, Swati Suman, a student of M.COM Semester IV (Enrollment

No.2019MCOM018) of Department of Commerce, Central University of
Rajasthan, hereby declare that the project report entitled “Analysis of Blockchain
technology in banking sector: Applications & transaction validation” is
submitted in partial fulfillment of the requirements for the award of the degree of
Master of Commerce, comprise only my original work and due acknowledgment
has been made in the text to all other materials used. The results embodied in this
project report have not been submitted to any other university or institute for the
award of any other degree.

Date (Swati Suman)

i
 SUPERVISOR’S CERTIFICATE

This is to certify that Swati Suman (Enrollment No.2019MCOM018) has completed

her project entitled “Analysis of Blockchain technology in banking sector:
Applications & transaction validation” under my guidance and supervision. To
the best of my knowledge, it is her original work and is fit for evaluation for the
M.Com Project.

(Dr. Sanjay Kumar Patel)

Date Assistant Professor
Department of Commerce
School of Commerce and Management
Central University of Rajasthan

ii
 ACKNOWLEDGMENT

I sincerely express my deep sense of gratitude to Dr. Sanjay Kumar Patel, my project
guide, Department of Commerce, Central University of Rajasthan, for her
extraordinary cooperation, valuable guidance and supervision. I thank her for helping
me at every step and guiding me in every way possible. This project would not have
been successful without her help and continuous guidance throughout this project.

I would like to thanks Prof. Praveen Sahu, Dr. Sushila Soriya, Dr. Neha Seth and all
the faculty members of Department of Commerce, Central University of Rajasthan for
their valuable suggestions and useful comments for this project work.

I also acknowledge with a deep sense of reverence my gratitude towards my parents

who have always supported me morally and economically. My sense of gratitude to
my friends, juniors and all who directly or indirectly, have lend their hand in this
phase of time. I perceive as this opportunity as a big milestone in my career
development. I will strive to use gained skills and knowledge in the best possible way
and I will continue to work on their improvement in order to attain desired career
objectives.

I submit this Project work of mine with great humility and utmost regard.

Date: Swati Suman

iii
TABLE OF CONTENTS

iv
 LIST OF TABLE

S.NO. TITLE PAGE NUMBER

1.1

3.5

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9

4.10

4.11

4.12

4.13

4.14

4.15

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 LIST OF FIGURES

S.NO. TITLE PAGE NUMBER

1.1

1.2

1.3

1.4

1.5

1.6

2.1

4.1

4.2

4.3

4.4

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 LIST OF ABBREVIATIONS

Abbreviation Explanation
CBDC Central Bank Digital Currency

DLT Distributed Ledger Technology

ECB European Central Bank

KYC Know Your Customer

NASDAQ National Association of Securities Dealers Automated
Quotations
SCIs SEPA Credit Identifiers
SEPA Single Euro Payment Area
Society for Worldwide Interbank Financial
SWIFT
Telecommunications
WTO World Trade Organization

vii
 Analysis of Blockchain technology in banking sector:
Applications & transaction validation

What is Blockchain:

A Blockchain is an ordered, decentralized, immutable ledger that allows a recording

of trans-actions in a network. The transactions are recorded in a block that is
unchangeable and contains all the information of the transaction. Any transaction or
information of value can be recorded and shared within the network. The traditional
ways of recording transactions are centralized, inefficient, expensive, redundant and
this is where blockchain comes in use.
One popular example of blockchain is bitcoin- a decentralized peer to peer digital
currency. Blockchain is the technology behind bitcoin. Blockchain provides the
foundation and means for recording bitcoin transactions – which can be used to
record anything. (Gupta 2018, 3-6.)
Blockchain possesses many characteristics that can solve problems in different
fields. The two main characteristics of blockchain are decentralization and
immutability. Blockchain is decen-tralized, meaning that the records are distributed
to all the parties rather than in a central ledger. It facilitates a peer to peer
communication network and eliminates the need for third parties. Since the third
party is eliminated, the operation is faster and cheaper. Another interesting feature
is immutability, meaning that once the transaction is recorded, it cannot be changed.
In case the transaction needs to be updated, a new transaction is created and updated
to all the networks. Transactions are verified by other computers in the network,
and once verified they cannot be tampered. Thus, it provides high security and trust.
(Attaran & Gun-asekaran 2019, 13.)
Types of block chain:

1.Public Blockchain:
Public blockchain are open-source. Anyone can participate in this blockchain,
means anyone can participate in the transaction aided by the Blockchain, every
participant can see what blocks are getting added and therefore anyone can
participate in the consensus process i.e. the process of what blocks get added to the
chain and what the current state is simply.

2. Hybrid blockchain:
By actually occupying a unique place within the blockchain ecosystem in that it is a
hybrid blockchain, which means that it combines the public blockchain privacy
benefits that gives businesses significant flexibility to choose what data they want to
make public and transparent and what data they want keep private.

3. Permissioned or closed-loop Blockchain:

The distinction in an acknowledged blockchain as compare to the public blockchain
is that the right to certify the transaction is provided to only very little pre-selected
nodes. The right for reading the blockchain may be public, or may restricted to the
participants.

4. Private Blockchain:
Private blockchain simply says, write permissions are restricted to one organisation.
Major applications include database management, auditing i.e. specific area of
single entity. To provide the right to read or validate to public is not needed here.

Research Methodology:

Research design Descriptive Research: -The descriptive research is a research

performed to describe characteristics of a population or phenomenon being studied.
In this project the descriptive research to identify the cause of the insight of various
challenges and global perspective of blockchain technology in Banking Industry.
Data collection: -
Secondary data
In this research paper secondary research data collection method is used, the data
has been collected through books, journals, newspaper, magazines and online
websites.

Limitation: -
The limitations of the study are those characteristics of design or methodology that
impacted the interpretation of the findings from the research.
1. Sample size may not complete representative the entire population.
2. Entirely relying on the data that has been provided by books and online websites
through secondary research data.
3. A failure to use a random sampling technique significantly limits the ability to
make broader generalizations from results.
4. Less geographical ability.
5. Man Power limitation.
6. Lack of direct communication by individual’s perspective.
7. Lack of time to study the broader concept.