Saving Malaysia’s Economy with Blockchain
Can blockchain be the solution for Malaysia’s financial issues?
According to World Bank, the forecast economic growth of Malaysia has cut from 4.9% to 4.3–4.8% for 2019 and 2020. A few external problems could contribute to the drop including the trade war between the US and China, the uncertainties of Brexit and the rising volatility in the global commodity market. This does not help when we still have emerging domestic issues. Three major issues require immediate attention and action from the government — the slowdown of economic activities, the skyrocketing living costs and also the increasing cost in doing businesses, say major Malaysian economists.
Blockchain has become one of the biggest buzzwords in the tech world and it is with no doubt starting to show off its potential across a myriad of industries. It is a peer-to-peer ledger that is distributed to “miners” or “node” all around the world. In a more basic sense, blockchain is a historical record that is unalterable and transparent to all the stakeholders. If there is any tampering attempted, all the parties will get notified.
Multiple countries are starting to explore this groundbreaking technology for the benefits that come along with it — transparency, security, immutability, and traceability. Malaysia is one of the countries that believe blockchain could stimulate a sustainable economic model while offering a saving grace for the slowdown of the country’s economic growth. Here are some use cases of how the key attributes of blockchain can resolve those issues.
Improving efficiency in mining and agriculture
According to Bank Negara, the biggest factor of the fall of economic growth mainly results from the efficiency and supply finance within mining and agriculture sector. Currently, these two industries are still heavily relying on inefficient, paper-based traditional business models. When coupled with precise measurements and processes, blockchain allows business owners to not only ensure the exact quantity and the quality of raw materials, they would also be able to trace the materials across the entire process of the supply chain. This can prevent over-acquisition and missing materials, minimizing data and human errors while at the same time increasing the speed of the process.
Cheaper for everyone
If there is one practical benefit that blockchain can bring to enterprises is saving overhead costs. Hence, this is why there are so many big corporates such as IBM and JPMorgan Chase that are currently looking into blockchain technology with the purpose of upgrading their technology and saving costs. For instance, JPMorgan Chase just launched their own payment system on the blockchain network in October in partnership with major banks in Canada, Australia, and New Zealand. The sector that has the most visible impact of deploying blockchain technology is none other than SMBs (Small-to-mid business).
With the use of blockchain, SMB owners will be able to reduce overhead expenditures due to the low transaction fees. According to research done by datalight, the fees of an average Bitcoin transaction is 260 times lower than Visa and MasterCard and 9000 times lower than PayPal. This effect is more profound in making international cross-border transfers. Not only is the fee lower, but the transaction time will also be a lot shorter than traditional methods. Small business owners will be able to receive payments in Bitcoins much faster than receiving fiat. This is because cryptocurrency payments are on a decentralized peer-to-peer network and require no third-party confirmation. Once the companies cut down the overhead cost, it will eventually yield a lower consumer cost.
Changing direction with WorldQuest
WorldQuest International is a Malaysian-based technology company that provides end-to-end blockchain solutions and business purpose-built tech developments. Our experts have assisted major industries ranging from supply chain and manufacturing to healthcare and real estate, to discover their underlying potentials and look for answers with the help of blockchain technology. WorldQuest International also provides a cryptocurrency payment ecosystem (CPE) to seamlessly connect business owners and consumers and build trust and transparency between them. They represent an example of the direction that the world of financial technology is heading towards — globalization of businesses for a stronger economy and a better country.