Exploring the Role of Blockchain Capabilities in the Performance of the Banking Industry with an Emphasis on the Mediating Role of Competitive Advantage

Objectives: The present study aims to investigate the role of blockchain capabilities in the performance of the banking industry, considering the mediating effect of competitive advantage. In the context of rapid digital transformation affecting financial institutions worldwide, blockchain technology has emerged as one of the most disruptive innovations, capable of reshaping traditional banking systems through enhanced transparency, decentralization, and data security. Consequently, understanding how these capabilities contribute to improved bank performance and competitive positioning has become an essential focus for both researchers and practitioners.

Methods: This research is applied in nature and descriptive–survey in method. The statistical population comprises 91 employees from the central offices of Bank Mellat in Shiraz, selected using Cochran’s sampling formula to ensure the representativeness of managers and digital banking specialists. Data were collected using a researcher-designed questionnaire consisting of 44 items measured on a five-point Likert scale, designed to capture multiple dimensions of blockchain capabilities, such as security, transparency, immutability, traceability, and transaction efficiency. Reliability analysis was conducted using Cronbach’s alpha, which exceeded 0.7 for all constructs, confirming acceptable internal consistency and measurement reliability. For hypothesis testing, structural equation modeling (SEM) was implemented using SmartPLS software to examine the causal relationships among the variables.

Findings: Empirical findings confirm that blockchain capabilities exert a significant and positive influence on banking industry performance. Banks that actively integrate blockchain into their operations tend to experience improvements in financial efficiency, customer satisfaction, innovation capability, and overall service quality.This effect is particularly pronounced in areas involving secure data exchange, fraud prevention, and instantaneous settlement processes, which align with the strategic goals of high-performance banking systems. Moreover, the results reveal that competitive advantage also has a significant positive effect on banking performance. Institutions capable of differentiating their digital services, responding flexibly to market demands, and reducing operational costs demonstrate superior performance outcomes compared to competitors operating under more conventional models.The mediation analysis further provides evidence that competitive advantage partially mediates the relationship between blockchain capabilities and banking performance. This finding suggests that the influence of blockchain technology is not only direct but also indirect-operating through the enhancement of strategic competitiveness. Banks that strategically deploy blockchain to support their innovation agendas and customer trust mechanisms tend to achieve sustainable gains in market position and long-term profitability. Given the current complexities and emerging challenges confronting the banking industry (including increasing regulatory requirements, rapid technological change, and intensified competition from non-bank entities) the adoption of blockchain capabilities serves as a critical enabler of resilience and agility. The study therefore recommends that banking managers adopt a systematic and proactive approach toward identifying, developing, and integrating blockchain capabilities into their strategic.

Conclusion: In conclusion, this study underscores the strategic linkage between technological capability, competitive advantage, and organizational performance within the banking sector. It provides valuable theoretical and practical insights for advancing research in smart banking, digital finance, and blockchain-enabled management, thereby contributing to a broader understanding of innovation-driven competitive dynamics in modern financial ecosystems.