While blockchain is still in the early stages of its development, momentum is shifting from a focus on learning and exploring the potential, to identifying and building practical business applications.
Blockchain’s premise of transacting and storing information on a decentralized, distributed ledger yields many benefits for enterprise application data. The following are a few of many current examples of the use of this technology in different industries:
Reduce cost and/or time for transactions
Cross-border transactions can be faster and less expensive. Instead of taking several days to complete a cross-border wire transfer, such a transaction can now be accomplished in seconds without the significant costs and fees. Ripple, a California company created in 2012, to make payments faster, cheaper and more reliable using blockchain and cryptocurrency technologies, promises its customers a 33% cost savings.
Improve cloud and system security
Statistics paint a frightening picture: More than half of small-and medium-sized businesses in the US experienced a cyberattack in 2017. The Equifax security breach in 2017 compromised the sensitive information of nearly half the U.S. population. The decentralized nature of blockchain creates a resiliency to cyberattacks by providing no single point of failure, meaning no component of a system can stop the rest of it from operating. It offers a different approach to cyber security which goes beyond endpoints and includes both user identity security, and transaction security. One additional benefit: customers can gain control of their own information
Blockchain technology allows for “smart contracts” – or self-executing contracts – that allow participants to avoid third parties like lawyers or banks. This is especially appealing to small- and medium-sized businesses because it significantly lowers costs, while increasing traceability, accountability and security. For instance, in manufacturing, smart contracts may replace current supply-chain processes such as bills of lading, proof of origin, or quality control. Another interesting application is tying smart contracts to the Internet of Things (i.e., cars, appliances, and devices). For example, a washing machine may contain a sensor indicating when it is low on detergent and then automatically reorder it. Smart contracts continuously gain more and more popularity among small business owners looking to alleviate the burdens of contracts.
Blockchain technology will undoubtedly continue to grow further facilitating and improving business operations for those who are ready to accept and embrace this innovative technology. It is now a matter of when, not if, all businesses will use blockchain in some or all parts of their operations.