Blockchain-Based FinTech Solutions for Secure, Transparent, and Decentralized Financial Services

Abstract

The rise of blockchain technology usage has been a fundamental revolution to the FinTech environment, allowing the provision of secure, transparent, and decentralized financial services. Although there is an increased concern with implementing blockchain-based FinTech solutions, there is little empirical research on how blockchain technology potentials can be converted into working decentralized financial services. This paper examines how Blockchain Technology Capability (BTC) can be utilized in making decentralized financial services more effective, especially the moderating effect of trust and transparency. It was based on the Resource-Based View and the Trust Theory, which is the reason why a quantitative research design was adopted, with data gathered among the users of blockchain-based FinTech applications, such as digital wallets, platforms of blockchain payments, and decentralized finance apps. 300 valid responses were obtained. The analysis was performed with the help of Partial Least Squares Structural Equation Modeling (PLS -SEM). The findings indicate that there is a strong positive impact of Blockchain Technology Capability on trust and transparency that subsequently positively affect the effectiveness of decentralized financial services. Moreover, the ability of Blockchain Technology has a direct positive effect on the service effectiveness. The mediation analysis has shown that trust and transparency mediate the relationship between blockchain capability and decentralized financial service effectiveness to some extent. The results add to the literature in the FinTech domain because they explain how blockchain potential generates value in decentralized financial systems and offer practical implications to FinTech companies that seek to promote trust, transparency, and service delivery.