Blockchain Trends To Transform Business
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Blockchain technology has been around for some time now but despite all the hype around it, its adoption is in early stages. Most people relate Blockchain to Bitcoin – the cryptocurrency. In this article, I would go beyond Bitcoin and look at other possibilities of Blockchain in transforming business models and impacting our daily lives.
Blockchain finds great applicability in the Finance industry in which speed and security of financial transactions are a must. Currently Banks and financial institutions use systems which are at risk of cyberattacks and phishing. These risks can be eliminated by using Blockchain to create a distributed ledger platform making the transactions more secure and robust. It has potential to transform the Finance industry helping the financial institutions, regulators and consumers alike.
Blockchain can be used by organizations to secure their confidential data. Blockchain stores data in a decentralized manner with multiple nodes keeping a copy of the data. Even if a hacker hacks one node, the other nodes would continue to work seamlessly. This is different to traditional data storage where the entire data is at risk as data is stored in centralized manner in a node.
One generic use of Blockchain is in developing Smart Contracts that can be used across any industry such as Finance, Construction, Real Estate, Insurance and even Music & Entertainment. The contracts built using Blockchain are secure, tracked and managed in an indisputable manner. Enforcing the contract is automatic and requires confirmation of all the parties in the contract. Smart Contracts replacing the transitional contracts would benefit all stakeholders. Let’s take an interesting example of Smart Contract in the Music industry. Currently a talented musician loses out due to piracy or value retained by large music label companies. A blockchain based music platform comes to play
where using a Smart Contract, a musician can decide to give his music for nominal price to individual buyers but charge a hefty amount if the music is used in a movie and so on.
Another Blockchain application is in better managing the Supply chain of businesses around the world. Today’s supply chains are global in nature and complex with multiple partners in between right from the source of raw material to the destination in the hands of the end consumer. With the help of Blockchain, the Supply chain can be made more secure and transparent. A good example is in the Foods industry where traceability from “Farm to Fork” is important to control quality and ensure food safety compliance. Blockchain helps to track the source of raw material, the batch process in factory, expiry dates, shipping details and so on.
Extending the above example in the Food industry to Jewellery industry could bring in transparency and credibility. The end consumer is ensured that the diamond jewellery that he/she is buying is indeed authentic as the entire supply chain was tracked using Blockchain. The risk of buying fake or stolen diamonds is eliminated thanks to this technology.
Blockchain stores data in a decentralized manner with multiple nodes keeping a copy of the data
Retailers who run Customer Loyalty programs can make use of Blockchain technology by utilizing its unique verification capabilities making the process cheaper and more secure. The intermediaries could also be eliminated.
The Healthcare industry can benefit by leveraging Blockchain. Patient’s medical records can be put up on Blockchain making it securely accessible to doctors who can treat the patients more effectively. The application can be extended to the Health Insurance industry to provide personalized insurance cover for individuals based on the secure and accurate medical records. The policies and related transactions can be handled on Blockchain. It would be a win-win situation for both the insurance companies as well the policyholders.
Education institutions can leverage Blockchain to issue degrees and professional certifications to their students thus making them tamper proof. It would be easy for potential employers to verify the degrees without having to invest time and cost to cross check the degree’s authenticity with the institution.
Not just businesses across the world but even Government bodies can start to use Blockchain in many initiatives. Blockchain can be used by Government agencies to maintain government records like land/ property records. Any property related transactions can thus be on Blockchain making them secure and irrefutable. This would bring down litigation costs in property related transactions. Similarly, citizen’s birth, death and passport records can be securely maintained using Blockchain. Aids can be paid directly to the beneficiary using a Smart Contract eliminating the middlemen and bureaucracy.
With all the possibilities surrounding Blockchain it is imperative that more organizations focus on investing in this technology. This would imply organizations training their employees in Blockchain, investing in piloting use cases, working with partner ecosystems and showing the willingness to change their business models.