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News of Blockchain's potential has reverberated throughout almost every industry this past decade, and the hype is justified.
In Deloitte's 2019 Global Blockchain Survey, 53% of senior executives expressed that blockchain has become a critical priority for their organizations this year, up 10 percentage points since 2018. Furthermore, 83% see compelling use cases for the technology, up from 74% last year, signifying a growing recognition across multiple industries that the technology is real and viable in the world of business.
This surge in popularity can be attributed to benefits like increased transparency, accurate tracking, secure permanent records, and cost reductions, all of which are reshaping how organizations are approaching their processes and technological innovations. Industries such as healthcare, banking, financial services, real estate, automotive, and even the public sector are especially well-suited to blockchain tech, leading the charge for the sectors lagging behind.
The blockchain is essentially a digital ledger that stores chronological information for all transactions carried out on a connected network. It's similar to a peer-to-peer network, but instead of relying on a single entity, platform, or system to control it, the chain is spread out across a multitude of machines, almost like a network of servers (or nodes, in this case). This is where the decentralization comes into play.
The only way to alter information on the blockchain is if every node on the network validates the transaction. It's append-only, meaning that historical data cannot be edited, adjusted, or changed in any way. This feature helps preserve the old data, ensuring that the contents stored within the blockchain are always trustworthy.
Still with us? Great, let's cut to the benefits that blockchain is delivering and how you can get started with it.
Blockchain was originally developed to support Bitcoin, the pioneering cryptocurrency. It now underpins many different types of cryptocurrencies, Ethereum included. Aside from that, however, it offers a variety of functional upgrades for modern businesses, particularly due to its increased security, reliability, and decentralized yet public structure.
Smart contracts, for example, can be deployed, updated and stored in a blockchain network to modernize, protect, and verify the signing process for any document.
One example is Slock.it, an Ethereum-based Internet of Things (IoT) platform that uses smart contracts to power the sharing economy. One of its applications enables customers to rent bicycles, which only become unlocked after both parties agree to a digital contract. This transaction can take place anywhere, even via mobile devices, so customers can immediately gain access to their rented bike after the agreement is finalized. The information is then stored in the company's blockchain and cannot be altered after the initial signing.
Cloud storage is another great way to upgrade existing platforms with blockchain tech, where content is stored in a highly secure environment with less dependency on major providers and lower associated costs.
Atlanta-based Storj has based its entire launch on exactly that with its product Tardigrade.io, which securely encrypts and splits files before distributing them across its storage platform, resulting in download speeds 20% faster than Amazon S3, among other benefits.
Supply chain management is a particularly great fit for blockchain as it helps improve transparency and accountability in logistics. Imagine being able to track the movement of goods all the way back to a source, with access to the full record of who handled the shipment and what happened along the way. In this use case, it has the potential to reduce fraud and theft, improve quality control, and prevent consumer-facing problems like contaminated foods or damaged goods.
For the healthcare industry, the accuracy of information is paramount, as are the privacy and security of data. Blockchain is already being utilized by some hospitals to store and encrypt confidential patient data, with multiple providers having access to it without the risk of security breaches.
Some of the other common uses of blockchain include general paperwork and record-keeping; quality control; supply chain management; payments, money transfers, and payroll; digital ID and authentication support; loyalty programs such as Gyft Block; and networking and IoT.
Clearly, it's an extremely flexible technology with endless possibilities, so what can your business do to begin reaping the benefits?
Blockchain is a complex technology that is susceptible to possible regulatory implications and implementation challenges. However, organizations that can overcome these hurdles and implement functional innovations will potentially join other front-runners in the race to blockchain supremacy.
The first step is to think strategically and align your business objectives with a long-term plan for blockchain implementation — an approach that will also produce noticeable value in the short term. By measuring the impact of the organization's pain points against the costs of developing and implementing a blockchain solution, it's possible to predict how the technology could result in financial benefits down the road.
Due to its relatively nascent lifespan, blockchain leaders will have the ability to shape how the technology is leveraged within their industry, so use this preparation time to find out what standards — if any — have already been established, and what regulatory barriers could stand in the way.
Once the strategy has been established, the next step is to decide which platform you will be supporting: existing or proprietary. Ethereum, for example, is one of the best and it's backed by an incredibly knowledgeable and supportive community.
Depending on what you're trying to do with the technology, there may be solutions out there already. Companies like Patron, Menlo One, Goldilock, and FCoin have deployed blockchain technologies of their own. Alternatively, you can build your own custom platform to perform in a way that best suits your organization.
In either case, we recommend enlisting the full support of an experienced software development crew to handle initialization, general development, deployment, debugging, and scaling. Consider partnering with nearshore software development outsourcing companies that can provide world-class blockchain experts at a fraction of the domestic costs.
Blockchain is poised to change so many aspects of the business and enterprise world. On the surface, it promises to improve traceability, security, and reliability due to its decentralized structure. At its core, it's designed to be a trustworthy source of information that is impervious to corruption and fraud.
According to a World Economic Forum survey, almost 60% of respondents believe that 10% of the world's GDP will be stored on blockchain technology by 2027. As adoption increases, organizations will need to form strategic partnerships with technology professionals to maintain pace with competitors, drive new innovations forward, and expedite the blockchain revolution in their industry.
Want to learn more about how blockchain technology works and how to leverage it for your own business? We've got you covered. Let's Talk!.