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“Change is the only constant in life”
-Heraclitus, Greek philosopher
If you have been following events from around the globe, there is a very good chance that you have heard about blockchain technology. Even though it started its journey to provide an alternative to the regular currencies, viz., cryptocurrencies just 12 years ago, it is already making its mark in almost every industry possible. Global blockchain technology revenues are predicted to climb to over 23.3 billion U.S. dollars in size by 2023. So undoubtedly, this change will not stop here - every industry is going to see massive disruption because of this new technology in the very near future.
If we explain in very simple terms, “blockchain” is merely a series of time-stamped “blocks” containing digital information, stored in a public database using cryptographic principles or “chain”. This digital information consists of 3 parts - information about a transaction, information about the participant of that transaction, and special information (hash) which distinguishes every single block from one another.
The significance of blockchain arises because of the following -
- The record of data in a blockchain is managed by a cluster of computers instead of one. It has no central authority controlling it - hence, this data is decentralized.
- A “block”, before being added to the “chain” is verified by potentially millions of computers distributed around the network.
- Once data is stored in a blockchain, it cannot be altered. No amount of authority of secret hacking can change this fact. Therefore, transactions over a blockchain are absolutely secure.
- Since blockchain is shared and immutable thus, everyone can see the information there, while keeping the user data hidden under unique obfuscation called “digital signatures”.
- Being decentralized, it carries no transaction cost.
When we talk about blockchain technology, the first thing that comes to mind is cryptocurrencies like Bitcoin. Cryptocurrencies sure have completely metamorphosed the world of finance. However, blockchain as a technology is much more than just finance and can have many more uses. There are a number of industries it has been revolutionizing since it came into the market, and it is on the way of transforming some more. Here are some of the industries which have seen or are about to see a complete shift because of blockchain technology -
- Money transfer: Even though blockchain originated to give rise to cryptocurrencies, mainstream banks and financial services have been using the technology against them for a while now. Several major banks have partnered with Ripple to improve cross-border money transfers and minimize the exposure to cryptocurrencies. This not only saves time and money for banks, it also does the same for the customers who can complete the whole process simply using a smartphone now.
Moreover, blockchain keeps a permanent record of every single transaction in a very secure manner. This cuts the cost of back-office functions and record-keeping significantly.
- Stock trading: Using blockchain technology in stock trading will ensure registration of equities, and hence it will also make stock manipulation by voting virtually impossible. This deletes the middle-men who regulate the system from fraud and manipulation and so the complex equation among brokers, regulators, and traders will be eliminated - which, in turn, will give rise to a faster, cheaper, and less risky trade execution. Some of the largest stock exchanges in the world like Shanghai stock exchange and Nasdaq have already announced implementing blockchain technology in their businesses.
- Investments: The immense security that blockchain-based platforms provide could help keep internal data as well as trading networks safe. It enhances the security of the entire system and saves them from hacking or Distributed denial-of-service (DDoS) attacks by distributing transactions across a broader network, and thus deterring hacks and reducing these types of disruptions.
Blockchain can do wonders in reducing election frauds, if not eliminating them altogether. If blockchain technology is used at the time of capturing votes, not only will it take care of the registration and identity verification of the voters at the time of the election, but the government and the public both will have a confirmation and highly resistant to the hacking audit trail, sealed in the system. The electronic vote counting will ensure no votes are changed or removed and no illegitimate voter is added. It will erase the recounting trouble as well. The pro-blockchain Swiss canton of Zug, promoted as “Crypto Valley,” successfully conducted a blockchain-based voting trial already in June 2018, allowing participants to vote on a mock issue via the canton’s blockchain electronic ID system. Australia is looking at a real e-voting system very soon.
With the rise of hackers everywhere, data on the internet and devices taking data from the internet, such as IoT devices, have been quite vulnerable to external attacks. Use of blockchain technology makes it possible to store every data with a digital signature (hash) publicly or privately, as needed. This makes data alteration impossible which makes hacking the data impossible. The Guardtime is currently applying the same in the security industry.
Blockchain technology can transform how law enforcement looks like today. Police records and evidence have been vulnerable to theft, alterations, and deletion over the years. It has been easy for anyone with some money to spare make their crimes disappear or at least get less punishment than they deserve because of lack of evidence. The distributed and tamper-proof record-keeping mechanism of blockchain can stop all that. This technology can also flag certain transaction patterns aiding the police to catch suspicious financial activities.
The healthcare industry has always suffered for the lack of a secure data storage and smooth communication among consultants to diagnose diseases and render treatment quickly. Blockchain can solve all that with its verifiable patient and doctor identity authentication system, and the distributed data storing system.
- Securing records: Keeping secure records and verifying data has always been a challenge in the legal industry like any other. Blockchain will resolve this issue. Moreover, documents like wills can be easily verified and making changes in the will can also be made more authentic with digital signatures of blockchain. This will eliminate time and money-consuming legal issues regarding inheritances, including crypto assets.
- Drafting contracts: With blockchain technology comes simpler storage and automation of data which will help organizations to draft and implement contracts easily. This may not turn lawyers altogether invalid - they will be required for valuable consultations, but this surely will cut down on legal fees.
- Traditional legal services: Services like notary public can also be completely automated on decentralized systems, reducing the cost for so.
Just like eradicating rigged elections, blockchain has the power to get rid of degree frauds in the same manner - by authenticating academic certificates. For example, Sony Global Education has collaborated with IBM and began giving out academic certificates using blockchain to secure student data. In the process, blockchain will also facilitate verification of student transcripts and educational records.
The supply chain is basically transporting goods from one point to a final destination, going through a series of temporary nodes in between. Using blockchain in this system will secure the transactions done in this series by documenting everything in a permanent and decentralized method which will be easy to share as well. This will greatly decrease delays, waste, and human errors as well as track the fair trade status of the products throughout the supply chain.
The human resources industry will be thoroughly disrupted if blockchain comes into the picture. Keeping safe records, conducting background checks, and verifying employee histories can be tremendously time-consuming for humans, while can be perfectly automated by using blockchain technology if all the details are saved in the blockchain ledger from the beginning. Chronobank is preparing to do exactly that for the HR department. After the hiring is done, even employee incentives and rewards for better employee engagement can be controlled with this new technology. eXo is one example of such blockchain consulting.
If you have ever tried to open a start-up company, you must have known how hard labour it is to collect investment. Blockchain has come up with a solution to this. Its decentralized feature allows pledgers or individual investors directly connect with creators and entrepreneurs to fund them. New projects can raise funds by releasing their own tokens that represent value and can later be exchanged for products, services, or cash. For example, the movie BRAID became the first major feature film to be financed through a token “crowd sale” on the Ethereum blockchain through its $1.7M campaign on Weifund.
The retail sector gains immensely from the surge in the use of cryptocurrencies. Blockchain technology in cryptocurrencies permits the user to connect with the seller directly without having to worry about trust and to pay in bitcoins or similar currencies. This gets the middle-man abolished, the high fiat processing and transaction charges along with them. Start-ups like Openbazaar are getting us there.
Real estate blockchain applications can help record, track, and transfer land titles, property deeds, liens, and more - making the verification, record keeping as well as leasing, renting, buying, and selling properties efficient, cheap, fraud-free, and error-free. Property is one such platform.
Artists in the music industry have faced big challenges in selling their albums because of free platforms like YouTube and Spotify who do not provide a commendable remuneration to them. Blockchain platforms like Opus provide a platform for artists to distribute their content without the centralized third-party intermediaries that reduce their profits. This helps smaller artists immensely and gives us, fans, a chance to explore a wider arena of music!
- Public transportation: This has always posed a complex problem in every city in the world, especially when a city grows. Blockchain technology can be used to create a public ledger where vehicle efficiency, timeliness, and user feedback can be stored. This will definitely help in creating better routes and schedules for public transport. UK-based blockchain app DOVU lets users share how they use public transport and bike and pedestrian paths and rewards them with crypto-tokens for sharing. Data like this can be of huge assistance in making a better transportation system altogether.
- Ride-hailing and sharing: One of the most significant features of blockchain is peer-to-peer value transfer - applying this to ride-hailing or sharing apps will totally remodel them by making them decentralized. This way, the middle-man is removed who surges prices and is known to not pay the drivers deservingly. A rider can contact any driver who would be willing to go towards his/her destination from the system directly. Metadata such as location and reviews can be added to a user profile published on the blockchain and payments can be executed autonomously via smart contracts similar to ICOs in cryptocurrencies. Start-ups like Arcade City have already made this a reality where drivers can manage their own clientele, set rates on their own, and even perform other tasks like roadside assistance and deliveries.
When it comes to blockchain discussions, science is one of the least talked about topics, but that is unfair. Scientists can benefit immensely from having a blockchain-based system storing securely all the past and present research going on around the world. Libraries can burn down, online libraries can get deleted, but blockchain ledger will never go through that. Researchers can access anything related to their field at any point if this system exists. There is much research that closes down because of a lack of funding, but many times they have some data or results, which can give the present research a new turning point. A blockchain ledger will resolve this issue. In fact, if there is an incentive system, researchers currently working on the same problem can communicate and/or collaborate with each other easily, hugely accelerating the desired outcome. This method will also relieve scientists from the frustration of publishing a paper on the same problem just a minute later than someone else, which presently discredits his/her entire research.
- Energy management: Blockchain can revamp the energy management system. Right now the traditional system in use, even though the government approved and well-invested, is centralized and hence is super complex and costly. Power Ledger, an Australian blockchain consulting, is currently trying to tokenize power generated through distributed means like rooftop solar panels. This system will pay energy-producers immediately using cryptocurrency which will allow p2p energy sharing or selling, making the most of such a resource and furthermore, reducing waste to a minimum.
In addition to this, companies like Acciona Energy are using blockchain to confirm how clean the energy distributed is, by tracking their origins.
- Plastic recycling: Blockchain is also being used to encourage recycling. The Plastic Bank project lets users exchange plastic for cryptocurrencies. It allows its users who take part in plastic recycling have an above-market rate for plastic waste.
Given all the changes blockchain is bringing, many people are outright calling it a “disruptive innovation”. While it sure is transforming the world one industry at a time, this disruption does not necessarily have a negative connotation. After an industry reaches its threshold point, it starts to become stagnant. If it ever wants to see any positive growth, change is good and much needed. With the exponential rise in this amazing technology, we sure hope to see a new, secure, less corrupt and better-managed world very soon.
Bhawna is Communtiy Manager at Blockchain Australia™ by profession and storyteller by nature. A reader at night and analyst during the day, her areas of focus are blockchain technology, marketing and startups. You can follow Bhawna on Twitter, LinkedIn, and Medium for her invaluable blockchain marketing tips and recommendations.
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.