For many people, the term blockchain is synonymous with Bitcoin. But while Bitcoin has been by far the most famous application of blockchain, there are many other ways this revolutionary technology is gradually finding its place in the world of business.
At its core, blockchain is simply a huge, decentralized and secure means of tracking transactions that isn’t easily repudiated. While implementations of blockchain outside the cryptocurrency sphere are still in their infancy, many have shown great promise and could just become accepted as the conventional way of doing things.
Here are a couple of examples of how blockchain is slowly changing how we do business.
Blockchain provides what is, in essence, a permanent unchangeable record of system transactions. It’s a way of managing syslogs and event records that creates a reliable and credible trail that comes in handy during internal, external and regulatory audits.
System logs and other forms of audit trails are a sacred tool for ensuring system and process integrity. Blockchain, therefore, guarantees accuracy and reduces the problems that come with the decentralization of processes, systems, and process/system audit trails.
You can track raw materials and final products throughout the supply and distribution chains. For example, in the manufacturing industry, one could track the product from the point it leaves the factory for the warehouse until it’s eventually shipped to the retail store.
2. Quality Assurance
Large modern organizations are complex entities that comprise numerous moving parts sometimes spread across multiple countries. This can make quality assurance an arduous undertaking. Blockchain technology can help businesses zero in on a problem faster when something does go wrong.
Companies can integrate every aspect of their supply chains into blockchain thus making it possible for investigators to quickly and accurately isolate the issue. For example, in the food industry, a salmonella incident can be traced to its origin in a matter of seconds. Thereafter, every batch from the same source would be quickly identified and removed irrespective of where it is along the supply chain.
3. Commodities and Securities Trading
Because of the sensitivity of financial transactions including the risk of fraud and the grave consequences of errors, commodities and securities trading from initiation to execution can be difficult and time-consuming. Blockchain can deliver faster trading on the securities exchange.
As a distributed system, the shared workload can reduce into minutes or seconds the processes that previously took days to finalize. You no longer need several manual validators to go through the trades and confirm they are in the clear. Ergo, blockchain not only automates the process but greatly accelerates it.
4. Smart Contracts
Smart contracts can help secure and automate vast volumes of transactions especially those that take place across different businesses or supply chains. The contracts ensure no proprietary or otherwise sensitive information needs to be disclosed or exchanged since this is validated by the blockchain technology.
Organizations can embed authentication logic into the code so transactions do not require manual individual authentication.
As we mentioned at the start, cryptocurrency has been the most visible and successful implementation of blockchain. Bitcoin is the best-known cryptocurrency but certainly not the only one. Ethereum, Litecoin, Bitcoin Cash, Ripple, and Cardano have done fairly well too.
Cryptocurrencies have enabled the creation of a financial transaction platform that’s not controlled by a central authority like fiat currencies are. This creates a degree of predictability that conventional payment systems such as banks cannot provide.
And in a world where privacy is such a hot topic, cryptocurrencies ensure greater confidentiality than the banking system. The sender and recipient of a transaction do not need to know the name and other personal details of one another.
Of course, it’s privacy benefits have also seen cryptocurrency used to facilitate criminal activity. This has been a blot on its successes but cryptocurrency has certainly found application in more positive ways than negative ones.
Much like cryptocurrency, electronic votes can be handled by a blockchain deployment in a secure, accurate and unbiased way. Using blockchain for surveys and opinion polling provides a mechanism for the collection of reliable and actionable business intelligence.
When organizations contract a third party to conduct polls on their behalf, blockchain can increase the degree of trust that the data is authentic and not compromised.
So how soon can we expect these applications of blockchain to become the norm and not the exception? Realistically, except for cryptocurrency, we’re still far off. That being said, the thing about transformative technology is that it can gain traction exponentially once the market is convinced about its value.
Think about the proliferation of smartphones in just the last 10 years. From negligible penetration, roughly half the world’s adult population now owns one. It’s not far fetched that blockchain could realize such success when it does take off.