- Popular use cases of Blockchain technology
- Smart Contracts
- Internet of Things (IoT)
- Personal Identity Security
- Money Transfers
- NFT (Non-Fungible Tokens)
The blockchain technology market has been predicted to shoot up from 4.9 billion USD to around 67.4 billion USD by 2026. According to the data collected from CB Insights, multiple startups and established firms that invested in this naive technology saw a record rise of $4.3 billion which is around nine folds higher than the revenue generated last year. These numbers are deemed to grow higher as most of industries will continue adopting blockchain technology in the future. Owing to the security and transparency blockchain offers, companies are big-time investing in adapting blockchain-based operations. IBM, the tech giant, has already invested $200 million and many European companies are exploring options. So let’s first understand what this technology is and why it has become so promising for the future?
What is Blockchain Technology?
Blockchain is a distributed, decentralized ledger with records of transactions that are immutable. In simple words, it is a process of recording information in a way that cannot be changed, deleted, updated, or altered. It is called Distributed Ledger Technology (DLT) because each ledger is duplicated and distributed amongst all the network participants. This ensures complete transparency in the transactions because each participant in the network has a copy of the ledger.
How does Blockchain work?
Blockchain has a primary unit where the information of any transaction is stored which is called a block. When the information stored in one block overflows, the second block links itself to the corresponding first block via identifying the hash.
Hash is a cryptographic signature ( a unique code) that is generated for each block. Now once the first block is filled with information, a second block is created with its own hash code and a hash code of the previous block which helps it identify its position (i.e. after the first block) to link itself and create the chain. Subsequently, each block connects with the previous and the next block following the same protocol forming a sequence of transactions. This sequence has a timestamp and the hash as mentioned above. Now even if the hacker will maliciously try to corrupt the system, the change in any block will be directly reflected which the network participants can easily identify.
The reason being, even if there is a slight change in the records of the block, another block with a different hash ID will be created which can be identified easily. The hacker will have to alter the hash numbers of the entire network to make these changes unrecognizable. This is technically impossible because there would be 1000s and millions of blocks already created in the system which would take ages to get tempered. Thus, blockchain technology, especially when designed and executed by a custom blockchain development company, proves to be 99.9% secure and tamper-evident.
Step by Step process of Blockchain:
- A new transaction takes place. This data is distributed to all the linked systems across the world.
- The network participants confirm the validity of the records/transaction.
- Once validated, this transaction is clustered with the previous block holding similar previous transactions.
- Simultaneously with each transaction holding similar records, a chain of blocks is created. These blocks form a collection of all the transactions that have happened to date.
- The transaction is processed to be complete.
Benefits of Blockchain
Systems can be vulnerable to cyberattacks and as a result, could delay outcomes and waste efforts. To avoid such things to happen, blockchain has paved a secure way wherein there would be absolutely no security breaches at all. So here are some of the biggest advantages that blockchain startups can enjoy.
Highest Security
None of the record-keeping systems are as secure as blockchain. Blockchain secures every record by encrypting and tagging it to the previous as well as the next immediate record via hashing method. Whatever is recorded on a blockchain is immutable and since each record has a copy of it in the node, it is not possible to make changes. Any change will be automatically rejected by other nodes.
Enhanced performance
Blockchain improves efficiency and accelerates all the processes by introducing automation and eliminating human errors. Since the transactions are stored in decentralized ledgers, the data validation becomes more trustworthy, quick, and efficient.
Greater Traceability
Blockchain creates a network of transparent supply chains which could be used to trace events like loss of goods, theft, etc. Each and every part of the supply chain process can be traced to ensure there is no alteration of the records.
Reduced Cost
Businesses put a great deal of money in managing their operations via third parties which can be otherwise used for innovation and business improvement. Blockchain eliminates the cost associated with third-party vendors. Since this technology doesn’t need validation of transactions, there is no further cost involved.
Popular use cases of Blockchain technology
Some of the best use cases for Blockchain technology have been categorized as follows:
Smart Contracts
Blockchain-based smart contracts are predetermined conditions, an agreement between two parties to make the deal transparent and unalterable. Since the contract is distributed and decentralized, none of the parties can make any changes in the contract at any point in time. The execution of a contract only happens when the conditions set in the contract are met. All the processes linked to the execution of the contract, therefore, start running automatically without losing any time, when the conditions are met. These blockchain-based contracts have proven to be extremely useful in the healthcare industry, government agencies, and real estate sectors.
Internet of Things (IoT)
Internet of things (IoT) has taken over the world with billions of devices connected globally. With this increase in the number of devices connected, the chances of hacking multiply. To avoid these possibilities of data breaches, connecting the IoT devices with Blockchain will help in eliminating such vulnerabilities.
Personal Identity Security
Personal Identity Security is an identity management system that doesn’t allow any transaction without the consent and identity verification of the user. Blockchain reduces or rather eliminates identity theft and prevents imposters from entering the system. Blockchain stores personal information on an immutable block (ledger) which can not be altered in any form.
Money Transfers
When it comes to transferring money overseas, there are a lot of foreign exchange regulations. It takes a lot of fees and time to complete the transactions. However, with blockchain technology, the intermediate costs are eliminated and money is transferred instantly. Many banks are in fact using cryptocurrencies for overseas fund transfer because it is quick and is cost-effective.
NFT (Non-Fungible Tokens)
Non-Fungible Tokens (NFTs) are cryptographic assets like art, videos, songs, collectibles that are unique and are recorded under their owner’s name. For instance, if you have an art piece as a digital item on blockchain under your name, you will be recorded as the sole owner of that item and will have all the rights to use or sell that item as per your convenience. This ownership will not be altered in any case because blockchain is immutable. The ownership of such a digital asset can only be changed with the generation of another valid and verified transaction if the owner sells it on the blockchain network. NFTs are deemed to be great money-making assets that can be bought, sold, or traded to increase your investment.
Industries Blockchain technology will disrupt
Use case of Blockchain in Healthcare Industry
- Patient record confidentiality
- Electronic Health Records that are easily manageable
- Improved clinical trials through vastly available public health data
- Drug traceability is bound to improve with blockchain
Examples of Blockchain startups in the Healthcare Industry:
Clinico – creates patient-based trial data-sharing community
Medicalchain – uses blockchain technology to store patient health records
Coral – uses the technology to automate multi-party administrative processes and accelerate care delivery.
Use case of Blockchain in real estate
- Tokenization helps in renting out properties using codes for a specific period of time
- Tenant and investor identities are digitally created which are easy to verify and the documentation process becomes way easier.
- Real-time accounting becomes possible and simple
- The sale of properties can be automated
Examples of Blockchain startups in Real-estate Industry:
Republic – one of the renowned and amongst the top blockchain using companies, Republic helps investors to build new projects, invest in crypto options and much more.
Safewire – solves real-estate fraud challenges by blockchain network to provide security of transactions.
RealIT – platform allows investors to buy tokenized properties with Ethereum (permissionless) through Real Tokens
Use Case of Blockchain in FinTech
- Creation of digital identities
- Identity verification through blockchain
- Bitcoin transfer
Examples of Blockchain startups in Fin-Tech Industry:
Bitpay – this American payment service allows to accept bitcoins and carry out transactions with Bitcoin cash and invest in cryptocurrencies
Synaps – this startup helps in improvising and automating the global loan syndicate market using smart-contracts.
Usecase of Blockchain in Media:
- Eradication of fraud
- Protection of IP rights using smart contracts
- Peer to peer content distribution
- Streamlined royalty payments
Examples of Blockchain startups in Media industry:
Mediachain – this startup uses blockchain technology to connect music with its creator and provide all the background information like producer, lyricist, lyrics, etc about it.
Rebel AI – this startup tracks the spending of the brand in advertising and media. The patent-pending blockchain of the company helps establish the publisher’s identity of the music or content.
Fluz fluz – this company has an ecommerce platform wherein it pairs blockchain with its social media to offer cashbacks for shopping in Starbucks, Nike, Disney, etc.
Usecase of blockchain in Logistics
- Improved freight tracking
- Quick Carrier onboarding process
- Secure data via vehicle to vehicle communication
- Security of IoT devices
Examples of Blockchain startups in logistics industry:
Openport – this is a mobile platform for connecting carriers and shippers directly to reduce cost, establish supply chain optimization and improve performance by implementing blockchain technology.
Shipchain – implements blockchain and freight platform pursuing smart contracts in logistics.
Blockverify – a startup that verifies products, transactions and merchandise using blockchain technology, and focuses on improving anti-counterfeit measures.
Usecase of Blockchain in Education
- Monitoring and facilitation of school, college, and university accreditation
- Protection of intellectual property rights
- Transparent record-keeping of students
- Prevention of diploma and transcript forgery
- Digital diploma/ degree accessibility across all university networks
What is the future of Blockchain?
Blockchain will become a game-changer technology in the near future. Predictions indicate that by 2030, companies will utilize blockchain development services as a fundamental technology for operating their businesses. Almost every industry from medical to energy to education would have incorporated it to bring security, efficiency, transparency, and authenticity to their working environment. With the enforcement of this new development in almost all the sectors, by 2030, businesses would be able to add the value of around $1 trillion.
As far as the legacy companies are concerned, they are eventually bound to adopt the technology because of the mushrooming of tokenization of assets and the increase in NFTs. All in all, the blockchain future is certainly bright and is set to bring a big transformation in the ways the world works presently.
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