Blockchain technology, first brought into the public eye through the mysterious Satoshi Nakamoto’s peer-to-peer value transfer mechanism, Bitcoin, has come to be recognized as having the potential to streamline myriad commercial and public processes. Which equates to significant savings in the time, and money departments as well.
The first and most obvious applications of the technology have been centered on overhauling a centuries old financial system. Just about every financial jarganaut on Wall Street has begun to experiment with blockchain technology to improve various aspects of the financial settlement and clearance, from day-to-day transactions to equities.
Touted as the catalyst for the fourth industrial revolution – and widely acknowledged as possibly being as important a technological breakthrough as the internet was a few decades ago – Blockchain technology, which underpins most digital currencies, is seen as a solution to the intermediaries who establish trust between two individuals carrying out a transaction.
These intermediaries are necessary at different steps of global transactions, and perform their task for a portion of the loot, in the way of fees and commissions. Blockchain technology promises to make the process more transparent, more instantaneous, for a fraction of what it costs to use established intermediaries. Therein lies blockchain’s appeal.
“The power of eliminating intermediaries is the ability to lower transaction costs and take back control from powerful financial intermediaries.” Says Kartik Hosonager, professor of operations, information and decisions at Wharton, pointing out the centralized intermediaries that crowd the financial sector currently.
“Blockchains have the potential to displace any business activity built on transactions occurring on traditional corporate databases, which is what underlies nearly every financial service function. Any financial operation that has low transparency and limited traceability is vulnerable to disruption by blockchain applications. DLT [Distributed Ledger Technology] is therefore both a great opportunity and also a disruptive threat,” states Bruce Weber and Andrew Novocin in a literature review on cryptocurrencies for the SWIFT institute.
Financial powerhouses like Santander Bank, JP Morgan and Goldman Sachs, among others, have undertaken projects with the objective of researching, developing and implementing the use of blockchain technology in some aspect of their operations.
From KYC processes and transaction confirmation, to settling exchange of equities and foreign currencies, bloackchain and other Distributed Ledger Technologies are set to have a large impact on the structures that govern the financial industry on both, a local and global level.
The transparent and immutable nature of blockchain technology has been recognized by various other industries, and could potentially reduce of illiminate the need for complex paperwork for a number of industries. These are some of the industries that stand to benefit from the application of blockchain based record keeping.
Shipping & Logistics
According to Joe Pinder, product strategy director at digital security firm, Gemalto, a blockchain system should be good at ensuring accountability, auditability, availability and integrity of the data it records. These four security deliverables make blockchain all the more appealing to an industry that needs to track various items moving through multiple chain links.
“As you go through the supply chain, there are many points at which you are handing off responsibility and accountability,” states Pinder.
Blockchain technology enables organizations to identify shortcomings in their supply chain as well as monitor the route products took on their way to shelves, and ultimately, consumers. For quality assurance purposes.
Danish shipping giant, Maersk teamed up with multinational technology firm, IBM blockchain solution for tracking consignments more visibly and efficiently.
Digital Identity Authentication
Users globally are taking more and more to transacting over the internet, which poses two risks, the possibility of having one’s identity pilfered, and most obviously, the risk of having one’s funds stolen. Enter digital identity management platforms like Civic, promise to mitigate the risk of having personal data misappropriated by bad actors for some or other nefarious activity, by logging and securing a user’s information on blockchain.
Being able to use one’s identification information more securely online opens people in developing nations to beneficial financial services and commercial opportunities.
The Medical field has been transitioning to more paperless systems for years and blockchain technology offers more convenience and security in regard to patient management, accessing and updating medical records and patient information as well as the heightened accountability in the distribution and doling out of medical equipment and drugs to patients.
The increasing implementation of blockchain solutions in the medical industry will likely increase vital patient privacy and enable medical practitioners to carry out their duties more speedily, and cost effectively.
Asset/Title Management & Transference
Blockchain technology also promises to alter the way assets change hands between human beings. Projects like UBIQUITY harness the power of blockchain to steamline the process of property deed transference and asset tracking. The project aims to declutter the realty industry by aggregating relevent data on a single user-friendly interface and removing the need for extensive paperwork.
While other projects offer tokens tied to real-world assets like silver and gold along with a faster way to buy and sell commodities, as well as lower the barrier to ownership, some projects in this category target inheritance.
Using blockchain technology based smart contracts will allow for easier and more transparent transference of inheritance to beneficiaries. Once certain conditions, stipulated in the smart contract (ie, beneficiary reaching requisite age) are fulfilled the smart contract will automatically transfer funds to the intended recepient, in accordance with the deceased’s wishes, without the need for an intermediary.
Blockchain technology will undoubtedly alter the financial industry, however the fact that the technology enables trust between participating parties without the need for an actual intermediary along with convenient record keeping as well as accountability through transparency, has made blockchain an appealing solution to the sore-points endemic in a number of industries.
From tax collecting and public administration, to the record industry and food delivery, blockchain technology has the potential to streamline a lot of processes and drive efficiency through speed and accountability offered by the technology. The above listed applications for blockchain technology are but a few of the more popular uses of the technology, while there are numerous applications currently being explored.
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