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How Blockchain Works for Various Businesses and Industries?

It’s a fact that progressive technologies always push companies to change their complete business models, and inspire them to create new ones. Some companies successfully adopt such technical changes whereas others missed the opportunity. But the question is, which technologies of the future will impact your business in the most positive way.

Over the past few years, you have regularly heard the term ‘blockchain technology. Especially, regarding cryptocurrencies. Blockchain technology continues to grow and become more user-friendly, it depends on you to learn this evolving technology to prepare for the future. 

If you are new to blockchain, then this is the right platform to gain potential knowledge about the same. In this blog, you understand what blockchain technology is. You’ll also learn how blockchain works, why it’s important, and how you can use this field to grow your career.

What Is Blockchain Technology?

Blockchain is a vast database that stores information in the form of blocks and chains together. This data is collected and stored in chronological order, which cannot be tampered with or deleted. However, the user with permission to access the data can verify the data to gain clarity on the stored information. Sometimes, it is also referred to as distributed ledger technology (DLT). 

Blockchain makes the history of any digital asset unalterable and transparent through the use of a decentralized network and cryptographic hashing.

To make you understand blockchain technology in a more simple way, let’s take this simple analogy. By comparing the working of blockchain technology with Google Docs document works. 

When you create a Google Doc and share it with a group of people, the document is easily distributed instead of copied or transferred. Here, it generates a decentralized distribution chain that gives everyone access to the base document at the same time. No one is locked out awaiting changes from another party, while all changes in the document are being recorded in real-time, making changes completely transparent. However, unlike Google doc,  the content and data on the blockchain cannot be modified once written, because of its premium security level.

Undoubtedly, blockchain is more complicated than a Google Doc, but the analogy is appropriate because it illustrates critical ideas of the technology:

Blockchain technology has several uses and applications, but it has primarily been used as a digital ledger. Below are the three main components that come together to make blockchain a success: 

1. Ledger technology:

Primarily this technology acts as an open ledger for everyone, which cannot be changed or edited. This technology is completely transparent and any information that is added to the system gets collected alongside the existing data stored. Thus, all the participants of the network have access to an enormous record of unchangeable transaction data on the platform.

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2. Immutable records:

As we already mentioned, records stored in a blockchain technology cannot be modified in any way, thus making them immutable. These records are inaccessible. In that case, if any error gets crept in, then an opposing transaction can be used to correct it.

3. Smart contracts:

One of blockchain’s most important merits is that it comes attached to a set of Smart Contracts rules. These contracts can execute functions automatically. Additionally, the contracts determine conditions upon which the transactions are to be performed.

These encrypted transactions do not need the presence of a third party, and are completely digital. Unlike manual contracts, these contracts do not require any processing fees or time delays involved. For example, a smart contract can assign the ownership of a residential building to the latest owner as soon as the last owner is paid.

How blockchain will shift various industries

Though blockchain technology is treated relatively simple and easy, it can profoundly change the modern way of business and functions of industries. Let’s have a look at the various sectors where blockchain is playing a crucial and disruptive role.

1. Finance

One of the best examples of blockchain technology is Bitcoin and has had progressive  effects on finance. Thus, companies that are involved in financial services and manage funds have already established their cryptocurrency units. In addition, stock exchanges such as NASDAQ are also joining in on the blockchain bandwagon.  

Here are a few influential names of the financial sector that are impacted by blockchain technology. A global leader, Credit Suisse offers banking services and financial solutions, has partnered with Paxos to settle its stocks in the USA. Another one is Ripple, an eminent blockchain company, has partnered with banking giants to facilitate cross-border payments. The Names of these banking giants are Santander and Western Union.

JPMorgan Chase has developed its blockchain-based currency called JPMCoin. This type of currency would help the organization to perform transactions with other institutions.  In short, blockchain has the potential to bring a paradigm shift in the financial sector.

2. Voting

Blockchain technology could be used to facilitate an advanced voting system. Voting with blockchain carries the potential to remove election fraud and boost voter turnout. The  blockchain integration into the voting system can possibly reinvent it. It provides incomparable security measures and abolishes outdated methods of voting such as paper ballots.  

Using blockchain in the voting system would make votes nearly impossible to tamper with. The protocol of blockchain would also maintain transparency in the electoral process, eliminating the personnel required to conduct an election and providing officials with nearly instant results. This would remove the desire for recites or any actual concern that fraud might threaten the election.

3. Supply chain

For the world of supply chains, blockchain promises latest solutions and intriguing opportunities. For example, this technology allows organizations to store information such as location, price, quality, date, and more.

The technology helps in making the management of this type of data conveniently, offering users to monitor the progress within the supply chain. A smooth, transparent, and effortlessly traceable supply chain will allow industries to function with the highest levels of efficiency.

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Even the supply chain managers will be in a position to track the location of the products anytime. They can also solve the discrepancies and supply chain delays ahead of the curve. Blockchain makes all this measurable while considerably bringing down administrative costs as well.

4. Human resources

Blockchain technology also influenced the human resource industry a lot. In the industry, blockchain will help HR professionals to have easy access to verifiable data, and employment processes can receive a contenting lift. It helps in saving time, enhancing overall efficiency and making hiring new talent a breeze.

It also helps HR managers to store employee data securely by implementing encryption. Smart contracts could also play a crucial role in this industry. It can ensure payment to contract-based workers only after they have finished the assignment. Furthermore, instead of waiting for the banks to process their salaries, HR can automate payrolls effectively.

5. Healthcare

Another critical sector that is positively impacted by blockchain technology is – Healthcare. It would benefit enormously by adopting blockchain technology and making it mainstream. Previously, the healthcare sector has always struggled to collect previous medical reports and information of the patients. Moreover, manual data entry can be error-prone, vulnerable to hacking, and challenging to track.

With the integration of blockchain-based solutions into the industry will eventually transform record-keeping. Thus, paving the way for medical institutions to have better clearness on the medical history of patients. Health insurance companies could also take advantage of blockchain technologies. Clients often tend to hide past medical history from their records to take advantage of a particular policy.

The big player of the medical sector is HealthVerity, which is developing permission and access rights-based approaches to development of technology. The platform called HealthVerity will work on the blockchain network with the support of private and government entities. The technology ensures that only accredited professionals can manage the client’s medical data. Thus, the blockchain implementation promises greater privacy and security.

Pros of Blockchain Technology

For all of its intricacy, blockchain’s potential as a decentralized form of documentation is almost without limit. From higher user privacy and intensed security to lower processing fees and fewer errors, blockchain technology may well see applications beyond those outlined above. But there are also some drawbacks.

  • Enhanced accuracy by eliminating human complicated in verification
  • Cost reductions by eliminating third-party verification
  • Decentralization makes it harder to tamper with
  • Transactions are secure, private, and efficient
  • Transparent technology
  • Provides a banking choices and a way to secure personal information for citizens of countries with changeable or primitive governments

Key Takeaways

  • Blockchain is a type of shared database that is distinct from a regular database in the way that it stores information. Blockchains store data in blocks that are then linked together in the form of a chain via cryptography.
  • In blockchain technology, when new data comes in, it is entered into a fresh block. Once that block is filled with data, it is linked onto the previous block, as a result it makes the chain of data together in chronological order.
  • Various types of information can be stored on a blockchain, but the commonly used information used in blockchain so far has been as a ledger for transactions. 
  • In the case of Bitcoin, blockchain is used in a decentralized way so that no single person or group has control—rather, all users collectively retain control.
  • Decentralized blockchains are immutable, that means the data entered is uniform. For Bitcoin, this means the transactions are permanently recorded and viewable to anyone.
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Conclusion

Hence, after reading this, you can conclude that blockchain has the potential to transform many industries. As a unattached technology, it can verify and track transactions. Also, it can speed up transactions in conjunction with the Internet of Things (IoT) and smart contracts.

Undoubtedly, blockchain has made a powerful impact on the world of finance with cryptocurrency, making everyone take notice. Cryptocurrencies have the power to challenge traditional currencies and have already astounded the established players in finance. Thus, it can be an early sign of how blockchain can substantially impact the rest of the industries. 

The most essential advantage offered by blockchain is that no one can own it, promises unparalleled security, and is completely decentralized. This makes it popular among business houses and individuals who want to operate with greater privacy. Moreover, several companies have recognized the possibility of blockchain, and they are eagerly racing to implement it into their systems. Thus, the future for this relatively new but groundbreaking piece of technology seems bright. 

Blockchain Technology – FAQs

Q1. Define Blockchain in Simple Terms?

Blockchain is a shareable ledger that records transactions and is complicated to modify or change. It also chases appreciable and intangible assets such as cash or a house.

Q2. How Many Blockchains Are There?

There are four types of blockchain networks currently – public blockchains, private blockchains, consortium blockchains, and hybrid blockchains.

Q3. Difference Between a Private and a Public Blockchain?

The blockchain which is open to selected people is only called Private blockchains, while public blockchain is open to the general masses. In terms of security, private blockchains are more secure compared to public ones.

Q4. What is a Blockchain Platform?

A Blockchain Platform is any platform that continues to support or facilitate Blockchains. There are many types of blockchain platforms for different needs, such as Hyperledger, Ethereum, etc.

Q5. What is Blockchain used for?

The most popular use of blockchain is digital currency such as Bitcoin. These days blockchain is also used in different sectors to safeguard records.

Q6. What are the three Pillars of Blockchain Technology?

Transparency, Decentralization, and Immutability are the three main pillars of blockchain technology.

Q7. Who Controls the Blockchain?

The control of blockchain is not limited to a single user. The power of blockchain is divided between all of the users operating on the network. 

Q8. Why is Blockchain Important?

Blockchain offers transparency, security, and trust between the entire network of users. It also offers cost effective and smooth methods for data recording and sharing.

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