Enhancing Financial Transaction Security With Blockchain Technology

Abstract

Background: Cryptocurrency represents a modern digital payment system that operates independently of traditional banking institutions. Instead of physical currency, cryptocurrencies exist as digital entries within a virtual ledger, facilitating transactions globally without geographical constraints. The emergence of cryptocurrency has revolutionized how transactions are conduct-ed, with a growing number of businesses—over 2,300 in the US alone—accepting Bitcoin and other digital assets for various purposes, including in-vestments and operational transactions. This shift underscores the potential of cryptocurrencies and blockchain technology to reshape financial and opera-tional practices across sectors.
Methodology: This research explores the integration of blockchain technolo-gy and cryptographic techniques in enhancing digital transaction security and operational efficiency. Specifically, we investigate the application of blockchain in sectors such as real estate, where it has been used to develop smarter con-tracts. Our study employs cryptographic hash functions to protect sensitive information. BLAKE2b-512 is utilized for hashing user identities, providing robust security due to its resistance to reverse engineering. Additionally, MD5 is used for hashing passwords, ensuring that even in the event of a database breach, user credentials remain secure.
Findings: The adoption of blockchain and cryptographic hashing techniques has shown significant improvements in transaction security and data protec-tion. By storing hashed values instead of plaintext information, the risk of sen-sitive data being compromised is substantially reduced. Our findings highlight that while BLAKE2b-512 offers strong protection for user identities, the use of MD5 for password hashing presents a layered approach to safeguarding sensi-tive information. The study demonstrates that integrating these technologies not only enhances security but also fosters trust and efficiency in digital trans-actions and business operations.