Blockchain technology is existing for ages. Yet, it was only a few years ago, that the true potential of the technology in revolutionizing several industries has been recognized. Earlier, the technology was only associated with cryptocurrencies. However, today blockchain technology is adopted by several large businesses for optimizing their overall work process. In 2021, $6.6 billion were spent on technology by large enterprises.
According to PwC, blockchain technology will enhance the global GDP by $1.76 trillion by 2030. Various large businesses are taking the advantage of utilizing technology to streamline their business and maximize their work process. Digital ledger technology is known for its transparency, traceability, and immutability. The technology has attracted several investors and is now one of the innovative solutions to improve security, conduct fast transactions with low fees, and reduce bureaucracy in banks.
How does Blockchain Help to Transform the Way Industries Work?
As per a survey conducted by Statista, a wide range of markets can benefit from implementing blockchain technology. The financial sector accounts for 30% of the blockchain’s market value. Blockchain technology has the potential to revolutionize how industries work. Here’s how!
Role of Blockchain in Governance
Along with the present automatic consensus rules, it is important to understand the extra governance structure and keep the system flexible to undertake time and situations and be active to adapt to unfortunate incidents. To identify the exact parameters of the entire system, it is required to conduct thorough groundwork and has to be self-governed. It is necessary to research the checks, balances, particular governance mechanisms, and arbitration. To develop a flexible government structure, it is important to understand the parameters required to encapsulate stakeholders’ interests and be flexible to handle future stocks.
Governance refers to all activities related to the decision-making process, involved in updates, creation, and desertion of informal and formal rules of a particular system. Moreover, these rules can easily be laws, smart contracts, etc. In the entire blockchain system, there are three major rules, where innovative blockchain solution is required. These are “fund governance”, “project governance”, and “network governance”. Although decentralized governance may not be the ultimate solution. However, it is important to implement and work best in a world filled with a lack of trust in the conventional government system, financial institutions, inequality, nationalism, and more. Implementing blockchain in governance will help to bring out an efficient and effective solution. It will help to solve issues almost immediately and change where needed.
Implementing Blockchain in FinTech Industry
The implementation of blockchain technology in the financial sector can launch a movement in the finance industry. Fintech is also known as Financial Technology and is an approach that can easily transform traditional financial services. Fintech consists of large businesses, small startups, and other additions to enhance the entire sector by creating robust and new applications, processes, business products, and models. Banks and governments consider FinTech as a negative aspect of the financial sector. The Fin-Tech industry will not only impact the traditional banking system but effectively transform the way banking works.
Fintech is a new industry that helps to improvise activities and help the public reach out to the services. The entire industry has already adopted AI as a part of “chatbots” for customer support. Machine learning and Artificial Intelligence, for omnichannel banking, detecting frauds, antiquation of bank branches, and applying the biometric solution for secure, and strong digital transactions. One of the major problems faced by banks today is the high cost of money transactions and the huge time that is taken to do the following. Blockchain technology can disrupt the conventional banking industry by introducing FinTech and making transactions quicker and budget-friendly. According to a report, the transaction rate in blockchain as of June 2021 is 2.58 rates per second.
Blockchain in Healthcare
The Healthcare industry has been eagerly waiting for blockchain technology to disrupt the industry, keeping patient care as the priority. Blockchain in healthcare can help boost the security, privacy, and interchangeability of patient data. The technology provides a better solution to share health-related data commonly known as HIE, by forming electronic medical records, which are efficient, secure, and intermediate. Blockchain technology in healthcare is the best field to try the “proof of concept”, and therefore a must investment for healthcare providers.
The healthcare information exchange system is underpinned by blockchain architecture to truly unlock the value of interoperability. Various blockchain-based systems have the potential to eliminate and reduce the overall cost of the present third parties. Blockchain technology has proved its potential throughout the entire healthcare system. In the future, a countrywide blockchain network based on electronic medical records can improve efficiencies, and support a better outcome for real patients. There is a wide range of opportunities available in the healthcare industry with blockchain technology. However, since the technology is still in its nascent stage, it will take time. The expert study suggests that by 2025, 55% of the healthcare industry will adopt blockchain-based applications for commercial use.
Internet of Things (IoT)
The majority of IoT companies are looking forward to implementing blockchain technology in their solutions. Did you know that in 2020, 20% of the IoT technologies have blockchain-enabled services? The deployment of IoT will help to increase blockchain services in industries over time. The reason is that blockchain offers a secure and scalable platform for communication between various IoT devices. Moreover, the technology is famous for its immunity to cyberattacks.
Besides, blockchain technology allows smart gadgets to make micro-transactions easily. The distributed nature of blockchain technology will help to conduct transactions faster and at much cheaper costs. Therefore, to transfer money or information across smart contracts, IoT gadgets will use blockchain-underpinned smart contracts as an agreement between two parties.
Incorporating Regulations in Smart Contracts
Other than cryptocurrency, blockchain technology also helps people with its innovative solution popularly known as “smart contracts”. The main idea of smart contracts is that the process is executed automatically when all the criteria are met. “The delivery of products only after receiving the payment” is an example of smart contracts. However, for any other conditions, it is important to manually input it.
Smart contracts are decentralized in nature and are not regulated by any particular authority. However, what should the parties do in case of any difference of opinion? Usually, the members of the smart contracts agree to the regulations. However, if parties from different countries disagree on regulations, it is difficult to find a solution in such scenarios.
Blockchain in Shipping and Logistics
Over the years, globalization has brought the entire trading industry together. With the mix of technology, trading has become more advanced in recent years, with large and fast vessels, robots operating ports, and huge computer systems to track cargo. However, the only issue is that all this data is stored and operated using paper. To upgrade the complicated logistic works, the large vessel companies have joined hands with various tech companies. The present era requires a lot of improvements through technological advancements along with the transformation of organizations, and collaboration of stakeholders. The success however will only be possible if the parties work together to transform the legacy procedures and adopt a new method to create logistics value.
Blockchain technology is the new “buzzword” in several industries around the world. Experts believe that the logistics industry must adopt the technology and embrace the methods that will help them to optimize their present working system. Although there are several obstacles to overcome, it is important to explore the different opportunities that technology offers. Therefore, companies can join hands and create a base for successfully adopting blockchain technology worldwide to unlock new solutions in logistics. A prototype of the “proof of concept” can be attained through the plan and design phase. In the case of the “POC”, all the corners of utilizing blockchain technology. They can do that by testing the application at the beginning and conducting large projects with several stakeholders. Overall, blockchain can create a huge impact on the shipping and logistics industry.
Blockchain in Data Management
Data management is to secure and protect data or sensitive information. Any person who utilizes public services is scared that their data will be tampered with or stolen from government agencies due to a lack of proper security. However, blockchain technology can help the issue by providing traceability, transparency, and immutability. The problems mentioned are not only limited to financial institutes but also include government agencies. Both of these organizations can utilize blockchain technology to protect sensitive information, and simplify the overall interaction among citizens. Encryptions are secure, however, they cannot fully secure the data. However, with blockchain, data breaching can be difficult.
Blockchain technology can manage information and make it easy for various government agencies to access and use critical public data alongside protecting the information. It is important to understand that a blockchain is a distributed ledger that is stored in the form of blocks on a private or public network. Once the data is provided to the network, it is stored as blocks, protected using cryptography, and cannot be changed or tampered with. Some of the banks, insurance sectors, and healthcare departments have shown interest in implementing blockchain technology.
Experts suggest that banks have as much to benefit from implementing blockchain technology in their organizations. With time, large enterprises can adopt blockchain technology to store their company information in the network and create a smart and secure architecture for employees. IT departments in government agencies often create algorithms that allow data of a particular blockchain to be shared in other networks under pre-determined conditions. Moreover, over time, the technology may allow organizations and individuals to access control of the network. Such transparency will help the agencies to achieve a highly efficient public network.
Experts predict blockchain technology will disrupt several industries, and transform how business works today. However, since the technology is still in its nascent stage, it will take time and effort to entirely incorporate it into the industries. However, it is predicted that in the future, the technology will be accepted and adopted by the government to improve public services. Industries like FinTech, logistics, and healthcare can adopt the technology and enjoy the benefits. It will help them with a secure network and quicker access to important information and digitize their entire network. The technology will also help people to understand new technology, and learn about it. Experts are certain that more and more use cases of blockchain technology will come up in the future. The blockchain technology market worldwide is predicted to assimilate $20 billion in revenue by 2024.