An Empirical Study of Blockchain Technology, Innovation, Service Quality and Firm Performance in the Banking Industry

Despite the potential promises that blockchain technology (BT) offers to the financial services sector, its large-scale implementations are still in a nascent stage. There is no consensus on what benefits BT may bring, and there is always a possibility of difference between expected benefits and experienced real-world impact. Since the actual impact can be assessed only after large-scale implementations by financial institutions, there is little empirical evidence available in the literature. In this context, this research seeks to explore the potential impact of BT by developing and empirically testing a model. For this purpose, we have identified four dimensions of BT, namely, Decentralization, Transparency, Trustlessness, and Security. The impact of BT on innovation, service quality, and firm performance is assessed based on the extent to which these dimensions are present in the organization. The linkages of the latent constructs are estimated by analyzing the primary data collected from senior managers of various banks in India. The findings of this study provide several important considerations regarding the implementation of BT.