If you are following new technology developments and trends, then blockchain would interest you. Blockchain is said to change the way digital services are provided across the industries.
What is so special about blockchain that it has industry-disrupting capabilities?
Get to know what blockchain is from the basic definition to selling points of this technology and how blockchain technology is used in the business process.
What is blockchain?
By definition, “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”- Don & Alex Tapscott, authors Blockchain Revolution (2016).
Blockchain is a trusted and decentralized network that facilitates the transfer of digital values such as data and currency. It facilitates fast and secure peer-to-peer transactions with required transparency.
The digital database is shared across a large network that contains several computers known as ‘nodes.’ Whenever an update is made to the database, it gets updated and downloaded to every node on the network. They are transparent, tamper-proof, permanent and the transactions occur in consensus with the participating parties. As each of the computers have a ledger copy, it prevents a single point of failure (SPOF). Moreover, the transactions are secured with cryptographic techniques, making it immutable for hackers. (In case, if hackers attempt, they have to hack more than half of the nodes in the blockchain to make changes, which is nearly impossible).
To give a simpler explanation, remember the traditional way of maintaining physical ledgers. While you are entering data into the ledger, your peer cannot have access to the data. You have to send it to your peer for editing or proof-reading. Now, when your peer starts working on the ledger, you are shut down from the access. Moreover, the auditing process is also there, which involves a few more human resources, time, and money. Mention not to say, the whole process is prone to manual errors.
Here comes the blockchain to rescue. The data are accessible in a secure and shared environment as they are stored in all the computers/nodes that run it. All participants can view and edit the changes simultaneously.
Moving forward, let’s walk through the selling points of blockchain in businesses.
Selling Points of blockchain in business
The blockchain industry has grown beyond cryptocurrencies today. Though the blockchain saga started with bitcoin trading, the commendable features of blockchain are explored in almost all industries you can name. The selling points of blockchain for businesses in the market are as mentioned below.
As the data is not stored in a single entity, every participant in the network has access to information.
The transactions occur in consensus with the parties and they get notified. A custom blockchain network can be created for a particular business logic.
As the transactions are approved by a network of computers, it removes human involvement in the verification process, resulting in a piece of more accurate information.
Blockchain eliminates the middlemen or third-party verification for transactions and thereby its associated costs. It virtually has no transaction fees.
As the transactions are digital and automated, businesses can streamline operations and reduce paper-based transactions.
Improved efficiency and speed
As the blockchain transactions do not need intermediaries, it leads to faster turnaround. It eliminates redundancy in operational processes in a stable and foolproof environment.
The core features of blockchain such as immutability, encryption techniques, digital signature, transparency, and decentralization make transactions highly secure.
Blockchain in industries
Blockchain technology can be implemented in multiple areas. The practical usage mentioned here helps you to see blockchain in a better way.
Most of the cryptocurrencies like Ethereum, Bitcoin, Litecoin, and other currencies use blockchain for recording transactions.
Banks use distributed ledger technology to speed up their back-office settlement. UBS Group AG, a Swiss multinational investment bank, and Berenberg, a German bank are exploring blockchain to increase efficiency and reduce costs.
Crypto kitties, a blockchain game demonstrated how blockchain is used to catalog digital assets. Specific token standards like ERC-721 (non-fungible) and ERC-1155 (fungible) are created to support the use of blockchain in the gaming industry.
Blockchain is employed in supply chain logistics and supply chain management. E.g. IBM’s Everledger.
It is another application of blockchain where casting and counting of the votes are taken care of.
Other industries that are benefitted from blockchain include aviation, digital marketing, insurance, music, and more. In brief, blockchain technology is used to create a permanent, public and transparent ledger system for data compilation and its tracking. And, so the disruption saga continues.
Are you ready to implement blockchain in your industry?
If so, learn and explore blockchain technology. Earning a blockchain certification validates your skill and a third-party vendor-neutral certification fetches you a competitive advantage in the industry. Become well-versed in blockchain concepts, principles, and applications to leverage the technology benefits in your industry.