I get asked many questions by both businesses and developers, about what are the best technologies and strategies to use for development projects. I am not a developer, so I can’t really speak to these questions in those type of technical detail, but as a businessman and general technologist – I can speak on what technologies are worth learning and which are worth applying to development projects when they may fit.
Lately, I have been seeing more and more use cases for blockchain and even cryptocurrency in solving business challenges with digital development solutions. Since its inception, which goes as far back as 1991, blockchain technology has been a gift that keeps on giving.
This article will go into what I think Blockchain for business means, and the most common use cases in the business world. No doubt, leveraging cryptocurrency or Blockchain into business the right way can be highly beneficial for businesses, small and large.
You can also find out more about Blockchain and Cryptocurrency by checking out our Blockchain Case Study and our podcast on Web3.0
Blockchain for Business: Definition and Meaning
Blockchain, in layman’s terms, is a digital ledger or database containing information chronologically. This information, including financial transaction records, among other things, can then be simultaneously used and shared within a decentralized network. The information stored in Blockchain cannot be altered or removed; this makes the network a highly trustworthy and transparent digital ledger. Blockchain for business exists on an immutable, shared ledger and is valuable for enabling entities to transact with one another.
This technology helps to verify and trace multistep transactions that require verification and tracing. It offers many benefits, including secure transactions, reduced compliance costs, and speed up data transfer processing. Also, businesses can use this technology to contract management and audit a product’s origin.
Features of Blockchain Technology that Make It Great for Individuals and Businesses
Blockchain has certain key features that make it effective wherever it is used, in business or otherwise. Together, the elements of blockchain work to ensure the technology securely records and stores digital data. What are these key features and elements?
Blockchain is a decentralized network, meaning no government, corporate body, individual, or third party governs or controls it. Instead, it is maintained by a group of nodes, allowing users to access it from the web and store assets. Blockchain’s decentralization ensures there is less failure; users have control and are less likely to break down authenticity, transparency, and zero scams.
Blockchain technology is immutable in that information on it cannot be altered or deleted. This makes it a permanent and unalterable network, made possible by relying on a collection of nodes rather than centralized authorities. Every node has a copy of the ledger, and each one needs to check the validity of any transaction to be added.
Blockchain is undoubtedly and maybe arguably the most secure network on the globe. Since no central authority exists, changing the network’s characteristics for individual purposes is eliminated. The system uses encryption, known as cryptography, which ensures another layer of enhanced user security and protection.
* Consensus Algorithms
Blockchain utilizes consensus algorithms that help the nodes on the network make their decisions. With millions of nodes on the system, validating a transaction will require a consensus to ensure smooth running. This consensus algorithm keeps the decentralization of every Blockchain going; without it, the core value of the Blockchain is lost.
Blockchain Use Cases: How Is Blockchain Used in Business?
Blockchain was created for Bitcoin, but it has since evolved from being useful for only cryptocurrency. Businesses all over the world have started using this immutable, distributed ledger technology for different purposes, including the following:
* Secure Records Sharing
Businesses use the technology for secure storage and transfer of records, utilizing the network’s strong, built-in encryption. Apart from being highly secure, this storage method tends to be cheaper than storing data in a rented space.
Sending and receiving payment is one of the most common uses of Blockchain in business. Businesses use cryptocurrencies, a decentralized currency run on Blockchain, by integrating them as payment methods. Although many businesses are still skeptical about it, the skepticism is going away gradually as more businesses have begun accepting crypto as payment.
* Managing Supply Chain
The supply chain management process is complex and time-consuming for businesses and teams, especially those in different countries. With Blockchain’s notable and impenetrable feature, most supply chain related issues can be reduced to the barest minimum or even eliminated entirely. These include a lack of transparency and payment process inefficiencies, among other things.
* Smart Contracts
Smart contracts are blockchain-based contracts created as agreements between at least two parties without involving any intermediary. They are enforced in real-time and exist across a distributed and decentralized network. Smart contracts are used in real estate, health institutions, and government agencies.
Businesses also use Blockchain for logistics; this solves the problem of lack of communication and transparency in the logistics industry. Data soiling, among other issues, is even more pronounced considering how many businesses use this operation, resulting in money and time loss. However, the industry can automate processes and build greater trust and transparency thanks to Blockchain’s data transparency.
How Can Adopting Blockchain or Cryptocurrency Help Your Business?
Businesses today are adopting cryptocurrency and Blockchain, irrespective of size and industry. From restaurants to nail salons and large-scale manufacturers to small businesses, Blockchain is beneficial to all. Here are some ways integrating Blockchain into your business can help it scale:
* Build Trust
Blockchain can help encourage trust between you and your customers, particularly where trust is unproven or lacking. As such, people who would otherwise not engage with your business will be willing to do business with you.
* Improved Security
Another benefit Blockchain offers is enhanced security; the network is impossible to hack. Your business can benefit from the network’s end-to-end encryption that prevents fraud and unauthorized access and activity. Blockchain is nearly impossible to hack, as opposed to conventional computers, because data on the technology is distributed across a network of computers. Also, with Blockchain, privacy issues are better managed through anonymizing data and requiring permissions for access.
* Save Money
Blockchain can be used to reduce the costs of running a business as processes that could have been handled manually can be automated. That way, you can guarantee effectiveness, and speed, while also saving costs. The technology can streamline clearing and settlement, eliminating the need for middlemen and helping businesses save money.
Thanks to Blockchain’s ability to automate time-consuming processes, your business can improve in speed and efficiency; this automation also eliminates human errors. Integrate Blockchain into your business, and you’ll find transactions handled in seconds or less.
Blockchain helps in employment processes in that you can use the network to verify the information of potential employees. Studies have shown that many people falsify information on their resumes, and hiring managers must verify it manually. However, there are pilot programs that member universities store their students’ data and which authorized hiring managers can access. This way, potential employers find out the truth about their interviewee quickly and efficiently.
More Customer Engagement
By bringing transparency, trust, and simplification to business processes, Blockchain inevitably improves customer engagement, thereby creating numerous benefits. These include giving users control over their information, identifying loyal customers, incorporating transparency, and fostering quick transactions.
Blockchain technology has helped many businesses scale in various industries, including healthcare, information technology, logistics, and manufacturing. It can be a game-changer in different business verticals along with other disruptive technologies. If you want your business to be part of this revolution, you must incorporate it into your business model. Businesses and customers who understand Blockchain’s benefits will reap its numerous gifts.
To find out more about Blockchain and Cryptocurrency, check out our Blockchain Case Study and our podcast on Web3.0
If you want to see how blockchain and cryptocurrency can be integrated into you business or digital product, please contact us at ScreamingBox.