The topic of blockchain’s impact on transaction processing has become increasingly relevant in recent IELTS Writing Task 2 exams. As digital technologies continue to reshape global finance, this subject is likely to appear more frequently in future tests. To help you prepare, we’ve selected a question that closely resembles those seen in actual IELTS exams:
Some people believe that blockchain technology will revolutionize the way financial transactions are processed, while others think its impact will be limited. Discuss both views and give your own opinion.
Let’s analyze this question and provide sample essays for different band scores.
Question Analysis
This question follows a common IELTS Writing Task 2 format, asking you to discuss two contrasting views and provide your own opinion. The key elements to address are:
- The potential of blockchain to revolutionize financial transaction processing
- The limitations of blockchain’s impact on transaction processing
- Your personal stance on the issue
Remember to support your arguments with relevant examples and explanations.
Sample Band 8 Essay
Blockchain technology has emerged as a potentially transformative force in the financial sector, particularly in the realm of transaction processing. While some herald it as a revolutionary advancement, others remain skeptical about its widespread impact. This essay will examine both perspectives before presenting my own viewpoint on the matter.
Proponents of blockchain argue that it has the potential to fundamentally alter the landscape of financial transactions. The decentralized nature of blockchain technology offers enhanced security and transparency, reducing the risk of fraud and eliminating the need for intermediaries. This could lead to faster, more efficient, and cost-effective transactions, particularly in cross-border payments where traditional systems are often slow and expensive. Moreover, blockchain’s immutable ledger provides an unalterable record of all transactions, which could greatly simplify auditing processes and increase trust in financial systems.
On the other hand, skeptics contend that blockchain’s impact on transaction processing will be limited. They point to several challenges that may hinder its widespread adoption. Firstly, the technology is still in its infancy, and scalability remains a significant hurdle. Many blockchain networks struggle to process large volumes of transactions quickly, which is crucial for global financial systems. Additionally, regulatory concerns and the need for standardization across different blockchain platforms pose substantial obstacles. The entrenched nature of existing financial infrastructure also means that transitioning to blockchain-based systems would require enormous investment and coordination among various stakeholders.
In my opinion, while blockchain technology indeed has the potential to revolutionize transaction processing, its impact will likely be gradual rather than immediate. The benefits of increased security, transparency, and efficiency are too significant to ignore, and we are already seeing major financial institutions experimenting with blockchain solutions. However, the transition will not be without challenges, and it may take years before we see widespread adoption in mainstream financial systems.
The impact of digital currencies on global trade is closely related to blockchain’s potential in transaction processing. As blockchain technology matures and overcomes its current limitations, I believe we will see an incremental but substantial transformation in how financial transactions are conducted globally. This evolution will likely lead to more efficient, secure, and inclusive financial systems, benefiting both institutions and individuals alike.
(Word count: 377)
Sample Band 6 Essay
Blockchain technology is a new development in the financial world that some people think will change how we do money transactions. Other people don’t think it will have a big effect. I will discuss both sides and give my opinion.
People who support blockchain say it will make big changes to financial transactions. They think it will make things faster and safer. For example, when sending money to other countries, blockchain could make it quicker and cheaper than the old way. Also, blockchain keeps a record of all transactions that can’t be changed, which could help stop fraud.
However, some people don’t think blockchain will change much. They say there are problems with using it widely. One big issue is that blockchain is still new and can’t handle lots of transactions quickly enough for big financial systems. Another problem is that governments haven’t made clear rules about using blockchain yet, which makes banks unsure about using it.
In my opinion, I think blockchain will change how we do financial transactions, but it will take a long time. It won’t happen quickly because there are still many problems to solve. But the good things about blockchain, like making transactions safer and faster, are important. So I believe over time, more banks and companies will start using blockchain for transactions.
How digital currencies impact international trade is related to how blockchain might change transactions. As blockchain gets better, I think we will see changes in how money moves around the world, but it will happen slowly.
(Word count: 269)
Explanation of Band Scores
Band 8 Essay
This essay demonstrates the qualities expected of a Band 8 response:
- Task Achievement: The essay fully addresses all parts of the task, presenting a well-developed response with relevant, extended, and supported ideas.
- Coherence and Cohesion: Ideas are logically organized with clear progression throughout. Paragraphs are well-linked, and cohesive devices are used effectively.
- Lexical Resource: A wide range of vocabulary is used with flexibility and precision. Less common lexical items are used with awareness of style and collocation.
- Grammatical Range and Accuracy: A wide range of structures is used accurately and appropriately. There are no noticeable errors, and the writing demonstrates good control of complex sentences.
Band 6 Essay
This essay exhibits characteristics of a Band 6 response:
- Task Achievement: The essay addresses all parts of the task, though some parts are more fully covered than others. The format is appropriate, but the conclusion is rather general.
- Coherence and Cohesion: There is a clear overall progression, but some cohesive devices are overused or underused. Paragraphing is evident but not always logical.
- Lexical Resource: An adequate range of vocabulary is used for the task. There are attempts at using less common vocabulary, but with some inaccuracy in word choice and collocation.
- Grammatical Range and Accuracy: A mix of simple and complex sentence forms is used. While there are some errors, they do not impede communication.
IELTS Writing Task 2 scoring criteria overview
Key Vocabulary to Remember
- Blockchain (noun) /ˈblɒktʃeɪn/ – a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system
- Revolutionize (verb) /ˌrevəˈluːʃənaɪz/ – to completely change the way something is done, thought about, or made
- Transaction processing (noun phrase) /trænˈzækʃən ˈprəʊsesɪŋ/ – the handling and management of financial exchanges or dealings
- Decentralized (adjective) /diːˈsentrəlaɪzd/ – transferred from central to local distribution or control
- Immutable (adjective) /ɪˈmjuːtəbl/ – unchanging over time or unable to be changed
- Scalability (noun) /ˌskeɪləˈbɪləti/ – the capacity to be changed in size or scale
- Intermediary (noun) /ˌɪntəˈmiːdiəri/ – a person or organization that acts as a link between people in order to try and bring about an agreement
- Regulatory (adjective) /ˈreɡjələtəri/ – relating to or concerned with regulation
Blockchain benefits for banking security is another important aspect to consider when discussing the impact of blockchain on transaction processing. Understanding these key terms will help you articulate your ideas more effectively in your essay.
In conclusion, mastering essays on blockchain’s impact on transaction processing requires a good understanding of the technology, its potential benefits, and the challenges it faces. Practice writing essays on this topic, considering various perspectives and using the vocabulary provided. As you prepare for your IELTS exam, keep an eye on related topics such as digital currencies, fintech innovations, and global financial systems, as these may also appear in future Writing Task 2 questions.
We encourage you to practice writing your own essay on this topic and share it in the comments section below. This active practice is an excellent way to improve your writing skills and prepare for the IELTS Writing Task 2.