When we talk about banking from a different operation point of view, decentralized banking is one of the most intelligent tools. Decentralized banking is a term that has been constructed in the wake of crypto-currency. The crypto banks use decentralized platform that provides usual banking services but it will work on the concept of hidden money. Currently, most of the network is online and people use online banking for fund transfer, payment, etc.
Decentralized uses the concept of P2P transactions between two users, where to exchange currency will take place. For example, if ‘A’ is having an online banking facility and in his absence, if someone tries to transfer money from his account to some other account then hacking takes place. This problem can be resolved using the decentralized banking system. In decentralized banking, the bank will create a group of customer like a blockchain. Everyone in the block chain is connected with each other and everyone account balance copy is kept in all customers who are part of the blockchain.
During every online transaction, it will check the balance amount which is present in Customer account with those accounts which are part of the block chain. If banking transaction is going on, then in decentralized banking it will check whether transaction which is going on is happening in all customers of blockchain ‘A’. If everything is proper then it’s a valid transaction. If the amount of customer ‘A’ blockchain group is not changed then it will be considered as hacking and transaction which is going on will stop and money will be credited in ‘A’s account, also the declined transaction message will be sent to the registered mobile number of customer ‘A’ This decentralized system is excellent to avoid online fraud. It is more helpful because of AI automation and ease of access via cell phones.