How to Use Blockchain to Improve Your Business
Blockchain is a technology that enables two parties to enter into any transaction without necessarily trust each other. Here is how you can utilize them to improve your business.
Understanding how Blockchain helps with trusted transaction among peers.
Blockchain is a distributed public ledger(chain) in which each entry(block) is linked to it’s previous one and encrypted. Okay, that’s too much information for a single sentence. Let’s put it into practice.
Say you bought a property with your lifetime earning, and after 6 months, you find out that the papers are fake. The officials are, of course, doing a great job. However, it takes only one minor breach to change the properties registry’s central database, and now, everything is in chaos. But what if everyone in the neighborhood has a copy of the original papers of your property. It would be so hard to make changes in all the documents, right? That’s a distributed public ledger in the blockchain. Everyone holds a copy of every transaction.
But if everyone holds a copy, how could it be safe? What about privacy? Well, they are encrypted; hence, others won’t be able to know the content without your key. But then what if someone managed to threaten all the neighbors and managed to change the ledger’s every copy? That’s very unlikely, but then the concept of chain helps even that happens.
Each block in the chain or transaction in the ledger holds a hashed key of its previous block (or marketing). This key is unique to every block, and even if a single letter in the whole document is changed, the hashed key is entirely different than the original key. Since each block’s content also contains the key of its previous block, if you change one single letter in one document, any coming after the changed one will be entirely different.
This hypothetical example might give a high-level idea of what blockchain is and how it functions. But you might also have further questions on this. We suggest Udemy’s Free The Complete Course On Understanding Blockchain Technology course.
Areas where blockchain technology can impact your business
In the future, you don’t have to worry about transaction costs, such as bank charges, as there is no intermediary in bitcoin and other types of cryptocurrency transactions. Also, nobody can lie about a transaction as it’s in a decentralized and encrypted chain of blocks.
Bitcoin is the first and foremost application of Blockchain technology. Bitcoin and any other cryptocurrency are not controlled by any central authority, and its transactions are validated across the globe. Bitcoin transactions are trusted to be more secure than bank or cash transactions as its distributed and immutable nature.
Smart contracts are self-executing contracts when specific conditions are met in the future. This allows UPS to receive cash on delivery at some location in a developing, emerging market. Then this product, many, many links up the supply chain, will trigger a supplier creating a new item since the existing item was just delivered in that developing market.’
Blockchain improves traceability in supply chains and records, leading to significant improvements in counterfeit materials getting into the market. And including lending records in the blockchain, along with data about invoicing, payments, and the physical movement of goods, can make transactions more cost-effective, more comfortable to audit, and less risky for all participants.
Blockchain is clearly a gamechanger in many industries. Thus, it’s going to alter the way legal systems across the world view different types of transactions, etc. The current legal system is built mostly to resolve issues that involve a lack of trust. With blockchain, trust is not an issue. Think about how much an impact it would have on your legal systems.
Blockchain allows us to enter into transactions with unknown parties and keeps the transaction secure. It helps to trace the origins of every nut and bolt of products. The power of decentralization eliminates the middle man entities such as banks and governments in our transactions, helping to make transactions quicker and cheaper. Indeed, this is going to change the way businesses work. Indeed the change has already begun.
In this article, we’ve given an introduction to blockchain technologies. However, the depth of this technology is enough to be taught in an online degree program.