Introduction to blockchain
What Is Blockchain?
Industries which will be disrupted by blockchain technologies
Banking and Payments
- One of the most talked about applications of blockchain technology is within financial and banking
- Currently, banking systems are costly, time-consuming and inefficient.
- However, blockchain provides a cryptographically secure way in which to send digital assets such as payments, loans and credit without the need for validation from a third party (such as banks).
- Existing finance businesses have been quick to experiment with blockchain technology due to the benefits it can bring such as increased security and operational cost saving – Santander UK has predicted the use of blockchain within their business will reduce costs by $20bn by 2022
- Traditional centralised data storage provides a central point of failure. The decentralized nature of the blockchain means there is no single point of attack for online hackers, making it virtually unbreachable
- The strong authentication proccess used by blockchain (i.e. public keys) offers superior security when compared to conventional logins and passwords
- Any data on a blockchain is immutable and completely traceable, companies can be assured any data on a blockchain is authentic and hasn’t been tampered with.
Supply Chain Management
- Blockchains provide a powerful solution to the problems seen in current supply chains which occur from high complexity and lack of transparency.
- Since every transaction can be stored on a immutable public ledger, distributed across the network, supply chains run on blockchains become highly transparent and trustworthy.
- Among many other large corporations, Walmart, Unilever and Nestle have all used blockchains to track entire supply chains. Securely tracking each stage from the farmer all the way to the shop floor.
- Blockchain presents the opportunity to radically transform the insurance industry
- Its cryptographic security allows for the improvement in trust between insurance businesses and clients through ensuring transparency throughout business processes.
- Blockchain technology also has the ability to improve fraud prevention, validating claims through a decentralised repository of customer records and previous transactions to check for authenticity
- Additionally, smart contracts allow for more streamlined claims processing, ensuring greater speed at which claims are resolved and payments are issued
- Blockchain technology solves some of the core issues facing charities in contemporary society
- Charities could benefit from faster, easier and cheaper money transfers through the blockchain
- Smart contracts can revolutionise funding agreements between parties and institutions, allowing for payments to be executed only when a requirement from the charity has been met.
- In theory, this will provide greater levels of corruption prevention and will allow for donations to be tracked to their final usage.
- Blockchain can be used to prove the identities. Combine this with the transparency and immutability, blockchain provides a perfect alternative to the traditional voting system.
- Using blockchain technology, governments can provide clear evidence of the votes cast, eliminating voter fraud and any chances of a rigged election.
- Blockchains gives high integrity to patient records, these can be efficiently accessed throughout different healthcare domains and systems. The distributed public ledger can provide real-time updates of patient records across all systems.
- Whilst avoiding compromisation of data security and integrity, blockchain technology allows various stakeholders in the healthcare value-chain to share access to their networks. This is possible due to the ability to track data provenance and any changes made.
- Blockchain has the ability to give consumers authority in how their own homes consume energy
- Through the decentralised ledger technology, populations will be able to trade energy with each other, on a plethora of peer-to-peer trading platforms
- This in turn will stimulate greater numbers of renewable energy projects as a whole, thus helping to transform the energy industry into a more environmentally-friendly, renewable energy-focused sector
- Blockchain technology allows for the solving of serious issues plaguing the retail industry
- Blockchain can be utilised as a public ledger for the registration of new products, their manufacturing origin and previous transactions.
- This means a duplicate transaction can therefore highlight to a consumer that a particular product is a counterfeit – this is important for rare or expensive goods.
- Stolen or missing merchandise can also be shown with relative ease, with subsequent transactions recorded in the blockchain highlighting to the owner of its whereabouts
- Notably, blockchain technology will improve the efficiency and security of real estate transactions
- Blockchain technology bypasses the necessity for trust between two parties, with financial information being able to be shared securely
- This reduces the risk of fraud and theft, as well as cutting out third parties who can be costly and time consuming
- A decentralised, distributed ledger also erodes access restrictions between databases for non-real estate professionals, bringing greater levels of transparency to the industry