Different applications of blockchain technology
When someone mentions you blockchain, your first thoughts might be cryptocurrencies. This is justified because of the Bitcoin which made boom on the market when its price skyrocketed to $20,000 at the end of 2017 and it was a subject to every newspaper, television, radio and internet portal
However, blockchain technology is first introduced in 1991 when two men called Stuart Haber and W. Scott Stornetta worked on the cryptographically secured chain of blocks whereby no one could tamper with timestamps of documents. Those were the first steps of blockchain, still, it is in 2008 that blockchain history starts to gain relevance, thanks to the one person or group of people called Satoshi Nakamoto. Very little is known about Nakamoto as people believe he could be a person or a group of people that worked on Bitcoin, the first application of the digital ledger technology.
From 2008 technology has evolved and found its way into many applications beyond cryptocurrencies. Satoshi Nakamoto released the first whitepaper about the blockchain in 2009. In this paper, he provided details of how the technology was well equipped to enhance digital trust given the decentralization aspect that meant nobody would ever be in control of anything.
Before we discuss different applications of blockchain technology we will briefly list its 4 most important advantages:
- Data integrity – Data inside the chain of blocks is hashed which makes it almost impossible to change data. Once it has been verified by consensus, the data is unchangeable and every attempt at change can be traced.
- Reliability – Blockchain is decentralized so it has no central point of failure, therefore it is almost impossible that it could fail. Each node in the network has a copy of the data so even if the system fails disaster recovery is easy.
- Speed and storage – The blockchain stores the data in the near real-time range. This allows large amounts of information to be exchanged quickly and efficiently.
- Analysis and transparency – The blockchain unchangeable and comprehensible system makes it possible to make transactions and their effects on the various contractual partners visible. This helps with transparency and accurate analysis, as the information cannot be changed.
Blockchain application examples in banking
- Peer-to-peer transactions – Blockchain could be used to avoid the danger of hacking, international restrictions or other limitations which can happen if you are using traditional providers like Paypal, MoneyGram, Skrill, etc.
- Protection against money laundering – This technology and its distributed ledger allows more transparency with regulators improving the reporting process. The shared and immutable ledger allows for unaltered transaction history whereby the ledger can act as a central hub for data storage where transactions are processed, and activity shared with risk officers within the financial services companies and regulators.
- Insurances – Blockchain can lower costs for insurers and lower insurance premiums for customers. It can also help insurers to understand and price risks better by allowing customers, risk policy information to be shared more quickly and securely across parties. This will increase revenue and growth prospects by allowing insurers to price insurance products more accurately.
Blockchain applications in the business area
- Real estate – The most obvious benefit is that it will cut off all the middleman. With brokers, banks, and lawyers collecting their standard 2-5% cuts, you will be saving up a small fortune. Real estate transactions can take months on end, and that is mainly because of the vast amount of bureaucracy, middleman, and lack of transparency that you need to go through. Smart contracts can protect owners from property fraud. You can link the digital ownership of your property, documents, and contracts directly to the blockchain.
- Supply chain management – In a blockchain-based supply chain management, record keeping and provenance tracking become easy as the product information can be accessed through the help of embedded sensors and RFID tags. The history of a product right from its origination to where it is in the present time can be traced through blockchain. The real-time tracking of a product in a supply chain with the help of the blockchain reduces the overall cost of moving items in a supply chain.
- Health services – Blockchain in healthcare improves the overall security of patients’ electronic medical records, resolves the issues of drug authenticity and drug supply chain traceability, and enables secure interoperability between healthcare organizations.
Blockchain application examples from the public sector
- Data management of citizens – Since the system is secure and cannot be modified, encrypted and yet mobile, it can also be used in the public area to store data about persons such as date of birth and death, relationship status, current residence permit, health insurance number, etc. Many administrators still rely on paper-based systems, which are often fragile and impractical for citizens. In this way, changes could be made quickly and easily online without having to go to an office yourself.
- Elections – What blockchain offers to the electoral process is a combination of accuracy, transparency, and immutability. It can be made anonymous, cannot change the past and is completely fail-safe and tamper-proof. This would make it possible to track your vote, see if it was counted correctly and it is absolutely impossible for a vote to be modified or even faked.
- Taxes – Immutability makes the provenance of every dollar known, making tax calculation easier and undisputable. Transparency enables all network participants including regulators to monitor wealth and asset ownership. Automation of tax transactions driven by smart contracts makes the process hassle-free for all stakeholders.
These are just a few examples of the possibilities of the blockchain and there will certainly be more in the coming months and years. The wide variety of possible smart contracts will help to make our data more secure and, above all, fail-safe which is very important in systems with a critical mission. Blockchain technology also has a huge perspective to provide new openings for occupation in the industry. It also enhances the professional’s capability to upgrade themselves.
In terms of our company we are carefully listening to market trends and requirements and already made a few steps in blockchain and smart contracts development. The latest move that we made is applying for the Block.IS project, which has received funding from the European Union’s Horizon 2020 research and innovation program, and successfully passed the first round of selection process.