Exploring trust dynamics in finance: the impact of blockchain technology and smart contracts
Abstract This paper explores the transformative impact of blockchain technology and smart contracts on the dynamics of trust within the financial sector. Trust is a cornerstone of financial transactions, traditionally established through centralized intermediaries and legal frameworks. However, the...
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| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Springer Nature
2025-08-01
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| Series: | Humanities & Social Sciences Communications |
| Online Access: | https://doi.org/10.1057/s41599-025-05473-9 |
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| Summary: | Abstract This paper explores the transformative impact of blockchain technology and smart contracts on the dynamics of trust within the financial sector. Trust is a cornerstone of financial transactions, traditionally established through centralized intermediaries and legal frameworks. However, the advent of blockchain technology introduces a decentralized, transparent, and tamper-resistant trust mechanism. This study aims to analyze how blockchain and smart contracts redefine financial trust by eliminating reliance on third-party intermediaries and automating trust through programmable agreements. Utilizing a mixed-methods approach, including case studies such as JP Morgan’s Quorum blockchain platform, we examine the practical applications of these technologies and their effects on transactional efficiency, data privacy, and trust realization. Key findings reveal that blockchain significantly reduces transaction costs, enhances transparency, and increases security, paving the way for innovative financial products and services. The paper contributes to the understanding of how decentralized technologies are reshaping the future of financial trust and offers insights for regulators and financial institutions navigating this technological shift. |
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| ISSN: | 2662-9992 |