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Blockchain technology, which lies at the base of cryptocurrencies such as Bitcoin, has gone way beyond the concept. Blockchain’s decentralized and tamper-proof architecture ensures it has potential use in many industries as a technology ranging from finance to healthcare, supply chain and even voting.
This is where Blockchain’s pela of transparency, security, and efficiency has upended traditional business models and created the possibilities for complete business reinvention. As for the subject of this blog post, let’s discuss what happens when industries implement blockchain, and how blockchain Applications Redefining Tomorrow’s Technology!
Blockchain in Finance: Beyond Cryptocurrencies
When people think of blockchain, the first application that comes to mind is often Bitcoin and other cryptocurrencies. However, blockchain’s potential in the financial sector goes far beyond digital currencies.
- Cryptocurrencies and Digital Payments
While it’s the most prominent and common application of blockchain, there are others. Blockchain offers secure, transparent, and decentralized financial transactions and this is how Bitcoin, ethereum, and thousands of other digital currencies are built.
These cryptocurrencies enable money transfers between individuals with no requirement to involve third parties such as a bank to facilitate the transfer charging lower fees than a bank and enabling fast cross-border transactions.
For example, Bitcoin has a blockchain that enables the P2P network of exchanges of value where people pay and get paid without intermediaries.
- Decentralized Finance (DeFi)
DeFi represents an emerging sector applying blockchain technology to build out existing financial services like lending, borrowing, trading, insurance, etc., in a distributed manner.
In the last few years, we’ve seen the DeFi Ecosystem explode, with platforms like Uniswap, Compound, and Aave providing decentralized alternatives to banks and financial Institutions.
Smart contracts and blockchain’s transparent ledger system are what powers DeFi platforms. Open to anybody with an internet connection, with no central governing body, these systems are much more resistant to the risks usually associated with traditional financial intermediaries. Payments and Remittances across borders
Cryptocurrencies are the most prominent and well-known application of blockchain. In practice, Bitcoin, Ethereum, and thousands more digital currencies use blockchain technologies for secure, transparent, and decentralized financial transactions.
These cryptocurrencies allow individuals to send money to others directly, without having to go through third parties such as banks, reducing the cost of transactions and time taken on international transactions.
For instance, the blockchain structure functioning as a basis of Bitcoin enables users to perform mutual payments with the help of its peer-to-peer network without appealing to the authorization of an administrator.
While Ethereum can perform transactions and store values and information like Bitcoin, it contains one additional feature – smart contracts, or programmable contracts that trigger automatic actions based on certain conditions that are used for more complex financial transactions and decentralized finance (DeFi) applications.
- Cross-Border Payments and Remittances
The use of blockchain technology in cross-border payments and remittances is changing the paradigm. In other words, traditional international money transfers are usually slow, expensive, and prone to fraud.
The need for intermediaries in cross-border transactions is being removed by blockchain networks such as Ripple and Stellar which make these transactions faster and cheaper.
By leveraging blockchain, remittances can be made securely and instantly across borders with reduced fees, benefiting everyone who exchanges money across borders—every time.
- Tokenization of Assets
The term tokenization refers to converting real-world assets like real estate, art, or commodities into digital tokens that live on a blockchain. Each token represents ownership or a part of an asset that can be traded on blockchain networks.
Thus, this enables fractional ownership – thus opening up investment opportunities to a broader swath of people and lowering entry barriers to those whose participation in traditional asset markets is impeded by financial barriers.
Take for instance the real estate platforms like RealT that allow users to buy fractional ownership in properties through blockchain-based tokens that democratize real estate investment.
Blockchain in Supply Chain Management
Blockchain technology is helping to streamline and improve the transparency, efficiency, and accountability of supply chains, which involve multiple parties, processes, and intermediaries.
- Tracking and Traceability
A primary concern that is common with every supply chain is a concern of opacity. They are all solved by blockchain that offers a clear and transparent record of every phase of a product’s journey from the manufacturer until it gets to the consumer side.
There is increased efficiency and effectiveness in terms of product authenticity since consumers are informed about their source and other quality attributes such as regulatory compliance.
For instance, the IBM-food trust blockchain helps companies track food products from the farm to the consumer eliminating food fraud, guaranteeing food safety as well as providing consumers with information about the food that they are consuming.
- Smart Contracts for Automation
Blockchain platform-based smart contracts can be used to automate any supply chain process. As an example, they can automatically pay when the goods are delivered, or ensure that a shipment has met quality criteria. It decreases manual intervention, hence speeding up processes, and reducing error or fraud risk.
Companies like Mercedes Benz have put in place blockchain-based parts and systems to track parts and also monitor the quality of components in the car industry to make sure pieces comply with the industry requirements.
- Reducing Fraud and Counterfeiting
Blockchain technology is more applicable in sectors where there is an issue of fakes and counterfeits like in clothing and accessories, drugs, and gadgets. Also through the use of blockchain, the history of the products can be documented and verified hence minimizing instances of fake products being conducted into the supply chain.
For instance, in the diamond industry, Everledger applies blockchain to provide real-time data to authenticate the diamonds’ provenance to eliminate blood diamonds.
Blockchain in Healthcare
Some of the biggest and most data-driven industries are within the healthcare sector. Blockchain has the potential to solve some of the problems that face healthcare such as security, privacy, and integration.
- Electronic Health Records (EHRs)
Application of Blockchain may lead to disorganization since EHRs can be stored in a decentralized method hence leading to reduction of management issues. It could give patients a level of personal control over their data so that it can be only released to the doctors as and when needed and it is also safe from tampering and easy to obtain.
For instance, MedRec which is being developed now is based on blockchain and it describes a system where patients’ records are safe and encrypted and can be accessed by relevant medical specialists regardless of the organization they work for.
- Pharmaceutical Supply Chain
The deployment of blockchain within the drug supply chain detracts from fraud within the pharmaceutical trade because every transaction is recorded to be incontrovertible proof. This produces various outcomes which include; confirming that the drugs are not fake and that they are being stocked and shipped at the right conditions.
MediLedger is another blockchain project dedicated to redesigning the chain of drug distribution so that none of the fake medicines would appear in the market.
Clinical Trials and research are most appropriate where there is a problem of fake and forged products, especially in fashion accessories and jewelry, drugs and other related products and electronics among others.
The changing of supply chain management includes the property that with the help of blockchain, the life-cycle of each product can be recorded and therefore it will be more difficult for counterfeited products to infiltrate the supply chain.
For example, Everledger applies blockchain in the diamond industry to track diamonds and provide information about them, including their origin, to prevent the circulation of blood diamonds.
Blockchain in Voting Systems
Through elections, citizens at the general level elect their representatives, and so the concept of elections is primary to democracy. But not all voting systems can accomplish the goals they are set because of issues like voting fraud, efforts to rig the vote, and general voter apathy.
One of the solutions to these challenges is the blockchain, which, due to its peculiarities, can comprise secure, transparent, and resistant to modifications voting systems.
- Secure Voting
In fact, through the deployment of such a technology can people have secure and confident assurance of their vote count with the use of blockchain technology.
The transaction on the blockchain and its votes are cast on an unchangeable ledger, and no vote changes can be made or tampered with. This would potentially shrink voter fraud and also increase the trust in the conduct of elections.
In 2018, the state of West Virginia was the first to use voting technology in blockchain when it allowed military personnel to vote from overseas via a mobile application.
- Transparent Election Results
With the help of the information available on the blockchain aided by the technology, elections can be conducted, and results posted that are free of doubt and will be open for validation.
When votes are cast, they are placed on the blockchain, and from that point, they can never be changed and they will be able to have full verifiability from everyone who cares to see them at any point in time.
This would go a long way to curb election tampering activities and allow the people to know their votes are fulfilled and their voices heard.
Blockchain in Identity Management
This is an issue in today’s generation knowing the advancement of information technology and communication. As a result of the application of blockchain, it becomes easy and swift to handle matters to do with identity as well as its authentication.
- Self-Sovereign Identity (SSI)
Self-sovereign identity (SSI) is the ability to recognize oneself and manage one’s identity which does not need approval from any intermediaries – government or corporations. Blockchain is the technology that enables the creation of a distributed architecture of SSI.
By utilizing SSI, users would not need to rely on non-existent identity databases, instead, they would store an identity on the blockchain that would only be partially disclosed where necessary. This would control the users and restrict instances of identity theft and fraud.
- Know Your Customer (KYC) and Anti-Money Laundering (AML)
The KYC and AML practices can be made easier on the blockchain if an identity can be verified once and for all time. This helps in the case where companies repeatedly verify a customer’s information.
Banks and other organizations can renew the verification of a user identity through blockchain technology. The sensitive information will be used once, allowing the risk of it being exposed to decrease.
Commercial identity and verification solutions are also already available, with uPort issuing digital identities on a blockchain to assist with KYC and other compliance measures.
Blockchain in Real Estate
The problems of the real estate sector are not new and have existed for many years, these include sluggish transactions, excessive costs, and inadequate transparency. Blockchain technology is the answer to these challenges as it would help create digital files for property transactions and speed up the process.
- Property Title Management
Recording property titles and the ownership history of homes on a blockchain prevents people from cheating and arguing over the ownership of a home. This means that should ownership be decentralized to the greatest extent possible, the records of property ownership transactions will not be found in banks or governments, and the transfer of ownership will be efficient, safe, and secure.
- Fractional Ownership and Real Estate Investment
Real estate ownership in portions is also possible with the creation of blockchain technology. With properties productive to become a shared asset, several people can invest and trade with pieces of real estate.
Conclusion
Blockchain is not only about cryptocurrencies but also about a disruptive technology that can dramatically reform many industries.
Applications of blockchains in various sectors are as follows: Financial services, health care, supply chain management, voting systems, and property management. And it can be expected that in the future as development advances, the sphere of utilization will expand and with it new opportunities and new problems for businesses, society, or individuals.
Despite there still being a few challenges such as; scalability, regulatory constraints, and public acceptance, it seems blockchain has a very bright future.