The
buzzword and technology trend for 2017 was – BLOCKCHAIN,
and it will continue to be so for 2019. An open ledger technology that began
with bitcoin and has been around for years seems to have entered mainstream
conversation lately. It is basically a global public database/ledger that
stores detailed information about every transaction enabling companies to prove
the security of their documents by being transparent about who owned the
document at any given time, citing proof of the fact that it hasn’t been
modified or altered in any way.
This
proved to be extremely vital for Bitcoin as it ensured that the same money
won’t be spent twice, unless a third-party plunges in. What also makes
blockchain further unique is that the ledger isn’t stored on one computer;
instead it’s shared across a huge number of computers which allows everyone in
the network to have access to it. Because of the reliability and accountability
that blockchain entails, it has become a customary element for development of
financial technologies today. However, other sectors are recognizing its
influence and structural integrity and are keen on imbibing it.
Following
are the industries that could be transformed by blockchain technology or have its indelible
imprint on their future –
Banking –
Blockchain
can inject enhanced accuracy and information sharing into a structured and
complex financial services ecosystem such as a bank by being a digitized and a
tamper-proof ledger. Banks are investing the maximum in blockchain startups,
for example, R3 CEV, a consortium of global financial institutions
collaborating to develop a platform and commercial applications for distributed
ledger technology. The platform has been called Corda and it meets the highest
standards in the banking industry but will be applicable to any commercial
scenario.
This
is what blockchain will do for the banking and financial sector –
·
Fraud Reduction
The
potential of blockchain technology to reduce fraud is getting a lot of
attention from the financial world because 45% of financial intermediaries
suffer from financial crimes every year. Most banking systems are built on
centralized databases that are vulnerable to cyberattacks where the hackers
only have to breach one system to have full access. The blockchain technology
would eliminate some of these crimes.
·
Smart Contracts
Blockchains
are capable of storing any kind of digital information which can be computer
codes as well. These codes can be executed when two or more parties enter their
keys enabling smart contracts. Once a set of criteria has been adhered to these
codes can be programmed to create contracts or execute financial transactions.
·
Know Your Customer (KYC)
Financial
institutions spend millions to keep up with KYC and customer due diligence
regulations annually. Blockchain would allow verification of one client by one
organization to be accessed by other organizations so the KYC process wouldn’t
have to start from scratch. This would bring down the administrative costs for
compliance departments significantly.
·
Trading Platforms
Operational
errors and fraud would be reduced if trading platforms started relying on
blockchain technology. NASDAQ and the
Australian Securities Exchange are already exploring blockchain solutions to
reduce costs and raise efficiencies.
·
Payments
Blockchain
disruption will eliminate many of the existing intermediaries in the payment
processing system. This will bring in fortified security and lower costs for
banks to process payments between banks, among organizations and their clients.
Healthcare
Healthcare
organizations face the challenge of secure sharing of data across platforms,
which is an impediment in the pursuit of delivering cost-effective care.
Employing Blockchain technology could allow hospitals, payers, and other
parties in the healthcare value chain to share access to their networks without
compromising data security.
For
example, Tierion, a blockchain startup has built a data storage and
verification platform for healthcare. Also, Blockchain Company GEM and Tierion
have partnered with Philips Healthcare in the Philips Blockchain Lab.
Ride Sharing
Taxi
apps like Uber, Hailo and Lyft operate as dispatching centers that use
algorithms to control their drivers and tariffs. Here, blockchain could
introduce a wave of new options where both drivers and users could create a
more user-driven and value-based marketplace because of the distributed ledger.
For
example, Arcade City, a startup with a ridesharing app for people where users
can select their driver, negotiate payment and enjoy personalized service. So,
Arcade City is basically functioning in a similar fashion to that of other
e-hail taxi apps but allows drivers to set their fares (in place of a
corporate) with blockchain recording all transactions. Arcade takes a
percentage of the rider fares and helps drivers build their customer base along
with providing value based services like deliveries and roadside assistance.
Retail
Blockchain
could change the existing dynamic of the marketplace by decentralizing the
trust. For instance in case of Amazon, its success is dependent on its
consumers’ sense of trust; here blockchain will attach that trust to sellers
than to site themselves.
There
are startups that are developing decentralized blockchain utilities to connect
buyers and sellers, without a middleman and the related charges. At
these utilities customers purchase goods using any of the available crypto
currencies, and sellers are paid in Bitcoin with all data distributed across
the global network instead of being stored in a central database.
The Internet of Things (IoT)
Blockchain
will prove to be a security fabric for IoT; it will give companies invested in
this sector the confidence that their IoT devices won’t be compromised. With
the rise of IoT severe issues will surface when millions of devices would want
to interact among themselves or their users and with the current IoT ecosystem
relying on the server/client paradigm, these challenges will be difficult to
meet.
Many
tech firms are exploring possibilities of resolving these problems with
blockchain technology. They are considering importing its core concept of peer
to peer messaging devoid of trust a complete possibility as has been proven in
the financial realm through cryptocurrencies such as Bitcoin. For IoT networks
blockchain will allow billions of devices to share the same network without the
need for auxiliary resources. IoT will definitely entail blockchain for a
future that involves decentralized and autonomous networks.
The
power of global blockchain is waiting to be harnessed in innovative ways by
companies, and the above is a mere glimpse of it. If you are seeking for
any kind of consultation, solution, service based on Blockchain Development, Blockchain Mobile App Development, you
can get a free quote at – https://www.consagous.com/contact/
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