Italy To Use Algorand Blockchain For Banking And Insurance Guarantees

Algorand has been selected as the blockchain to support an innovative digital guarantee platform for Italy’s banking and insurance markets.

Cryptocurrencies are now gaining more popularity and adoption. Adoption and real-life use cases influence the price of an asset and make it durable. Bitcoin is accepted as a form of payment on numerous platforms as the world looks to migrate to a cashless society.

Altcoins are not left out either, finding applications in various sectors like gaming, DeFi services, and the collection of NFTs.

Although crypto critics are quick to point out the flaws of cryptocurrencies which include volatility and periodic hacks, the sector is still on the rise. It is almost impossible to imagine a world without cryptocurrencies since they have become intertwined with virtually every sector.

Some investors believe that it is only a matter of time before cryptocurrencies dominate the world and gain even more relevance. Service providers and companies like Tesla accept crypto as payment, and the adoption is spreading to other regions.

Italy Banking And Insurance Sectors To Partner With Algorand

This platform will officially launch early in 2023. It is the first of its kind since it is the first time a member state of the European Union will apply blockchain technology for banking and insurance guarantees.

A bank guarantee is an agreement in which an institution pledges to cover losses for a borrower’s loan defaults. It is a viable alternative to security bonds or deposits to a vendor.

Insurance guarantees are similar but offered by insurance companies. Again, Algorand will step into this role, with its fast, efficient, and low-cost network an advantage. It will also protect these organizations from fraud with the highly secured blockchain.

Objective: To Boost The Country’s Economy

This innovative platform is developed by the research center on Technologies, Innovation, and Finance of the Catholic University of Milan.

The project aligns with Italy’s National Recovery and Resilience Plan. This plan aims to boost Italy’s economic rise following the setbacks suffered during the COVID-19 pandemic.

Algorand has recently upgraded its transaction speed, cross-chain functionality, and processing capacity following its protocol upgrade.

The Algorand layer-1 blockchain network added state proofs to its mainnet, facilitating trustless communication between various blockchain protocols.

Following the upgrade, Algorand’s transaction processing speed increased from 1200 to 6000 transactions per second. Federico Rajola, a professor at the Catholic university, stated that the choice of Algorand for the project was due to its unparalleled level of innovation.

He stated that the project aims to help Italy recover from the economic setback suffered due to Covid-19. He expects excellence through innovation and leadership. Rajola also said that these platforms contribute to the sustenance of Italy’s competitive edge.