People are getting used to bitcoin and other cryptocurrencies slowly.
Keeping this in mind, industry experts are now shifting their focus to the blockchain.
Blockchain is the underlying ledger system used in crypto trading.
Understanding blockchain at its roots is pretty simple. The technology uses local storage on every system connected to it. In other words, there is no common server or data center for keeping the records.
Every transaction or communication on the network is encrypted peer to peer. Although the peers can access the blocks, they cannot make any changes to them.
Blocks are small packets of information. Several blocks are linked together, hence the name – blockchain.
Blockchain has several other applications, apart from fueling the cryptocurrency trade. Perhaps, it wouldn’t be wrong to say blockchain can solve several everyday life problems.
Below are some use cases for blockchain in everyday errands.
Since blockchain is irreversible and tamper-proof, it is perfect for sending money across borders. The activity remains safe with blockchain’s modern asymmetric encryption.
In 2018, the world’s first blockchain-based money transfer service was launched. Santander One Pay FX, the money transfer service, was built on Ripple’s xCurrent.
The service enabled customers to make same-day or next-day international money transfers.
Furthermore, automating the process reduced intermediaries, time, and cost of transfer for the users.
Also Read: Updating the Industry via Blockchain Technology
Another banking sector industry that is enjoying the benefits of blockchain is the capital market.
Blockchain has enabled faster clearing and settlement for investors. As a result, the investors need not wait to encash their capital gains.
Besides, the technology has also improved the situation for auditors and accountants. The technology provides a consolidated trail of the investments.
You may need to study some more Blockchain Resources to know how blockchain is created.
Nonetheless, here’s an interesting fact for you; blockchain for the capital market has been in use since 2013.
Yes, the scope for technology in the capital market started shortly after the launch of bitcoin. And ever since, the sector has been growing, although not in the number of competitors.
The long-established trade financing methods have several inefficiencies. For example, the process is relatively slow. It is prone to discrepancies, undoubtedly because there is a lot of manual work involved.
Besides, the number of intermediaries also increases the cost of transactions. And not to mention, it can induce mistrust in the trading parties.
In contrast, blockchain removes all the inefficiencies of traditional trade financing.
Not only does the technology allows a secure way to finance it, but it also allows automation.
If you don’t know, you can set a date, time, or even put up a condition for the transaction. For example, you may put a condition. ‘the payment will only be released when the shipment is received.’
Supply Chain Management
Notably, the immutable nature of blockchain makes it perfectly suitable for real-time tasks such as logistics.
Since goods keep on changing hands throughout the shipment, it becomes difficult to keep track.
Entries in the digital ledger can be queued up to create events in the supply chain. For example, sorting and distributing couriers in a warehouse.
In short, the technology provides a dynamic method to organize and track data in a supply chain.
Most users would find it uncomfortable to share their medical history on a public network.
People only open up about their health concerns before their doctor or a life partner.
Perhaps, doctors may use blockchain to maintain their patients’ records.
Since only the users already on the network can access the information on it, the data would remain within a particular organization only.
Moreover, the doctors may use the stored information in times of emergency when the patients may not be in a condition to tell their history.
Reports suggest an average American sells their house every seven years, which means Americans move at least 12 times during their lifetime.
Clearly, the frequent transactions in the real estate realm can benefit a lot from the blockchain.
Since the records once registered with the network remain there permanently, the realtors and mortgage companies can easily track user data.
It becomes a lot easier to examine a buyer’s finances and credit history.
Besides, the technology can also enable transparency in real estate transactions from contract to close.
Now, it is critical to mention here that blockchain does not help with energy distribution. Instead, it helps with energy supply chain management.
Considering the benefits that the finance sector is enjoying with the help of this technology, it might be easier to understand its applications in the energy sector.
The utility companies can use the decentralized ledger to maintain user records.
Apart from this, the companies can also maintain a lifelong user history on the network. And not to mention, every piece of information will be encrypted and protected.
Not only the private sector but public and government sector agencies can also benefit from blockchain.
National, state, and local agencies need to maintain several records for the citizens. From their financial history to their first day at school and everything in between, the agencies are responsible for maintaining every piece of information on a citizen.
Perhaps, the vast size of user data also poses hacking risks, especially for digital records.
Now, this is where blockchain comes into play. Its immutable nature and asymmetric encryption allow records to be safe.
Besides, the decentralized ledger system also reduces the cost of maintaining a huge server for user data.
Also Read: FinTech’s Ultimate Guide For Beginners
In a nutshell, the distributed ledger technology is no more limited to crypto trading only.
From banking and finance to energy and governance, it has applications everywhere.
In fact, there are many more sectors that are exploring the scope of blockchain. Although most of them are still nascent, the future seems quite promising for them.
Perhaps, we will see many more sectors and industries exploring blockchain’s potential in the coming years.
Leave your comments below and let us know what you think about the technology’s applications in other sectors.
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