Blockchain was created to serve as the public transaction ledger of the cryptocurrency Bitcoin. The invention of the blockchain for bitcoin made it the first digital currency to solve the double-spending problem without the need of a trusted authority or central server. The bitcoin design has inspired other applications, and blockchains which are readable by the public are widely used by cryptocurrencies. In this article, we’ll clarify key areas where your business can benefit from blockchain technology.
Cryptocurrency Consensus Algorithms
Blockchain technology enables data privacy and security. Its database isn’t stored in any single location, meaning the records it keeps are public and verifiable. To make sure that a transaction is legal and came from the trusted source, Blockchain utilizes cryptography methods and algorithms. Proof of Work (PoW) is the most popular algorithm being used by currencies such as Bitcoin and Ethereum.
PoW is not without its faults: it consumes large quantities of power. But it still has been used by the most important cryptocurrencies.
There are also alternative consensus algorithms such as Proof-of-Stake (PoS), Proof-of-Authority (PoA), Proof-of-Weight (PoWeight). Every algorithm has its own pros and cons and can be used depends on the business needs and logic of the main system.
Now, we’ll dive deep into the review of industries that benefit from blockchain.
Blockchain Use Cases in Business
The best way to appreciate blockchain’s potential and determine its value for your business is to look at possible use cases. We’ve reviewed the main domains for blockchain business utilization.
Food and pharmacy industry
According to the World Health Organization, every year, 600 million people around the world get sick after eating contaminated food and 400,000 die from foodborne illnesses. For companies at the heart of a food scandal, the consequences can be dearly and long-lasting.
Blockchain brings advantages for food stackholders enabling product traceability. It can be used to quickly pinpoint a source of contamination and reduce the impact of food recalls.
Now switch for a moment from reading to video, and check the explanation of how Walmart can track food products through its supply chain using Blockchain by Frank Yiannas, Walmart’s Vice President of Food Safety.
The Walmart example demonstrates, that blockchain also helps to reduce the amount of contaminated products. This technology enables food chain stakeholders to be paid more promptly.
The WHO estimates also that around 10 percent of all drugs being circulated globally are counterfeit.
Many pharmaceutical companies view blockchain as a means to secure the supply chain through an electronic tracking system to prevent counterfeit drugs from reaching end consumers. Blockchain can also help to ensure the continued flow of vital drugs so patients can receive the proper dosages and treatments.
Here’s an example of Medicalchain decentralized platform that allows secure, fast and transparent exchange and usage of medical data. Medicalchain enables users to give conditional access to different healthcare agents. Each interaction with their medical data is auditable, transparent and secure, and will be recorded as a transaction on Medicalchain’s distributed ledger. During this process, the patient’s privacy is protected at all times.
Main interest from defense industry in blockchain are encrypted data protection and data decentralization. Blockchain enables creating a distributed infrastructure with the highest level of security. With the help of blockchain, defense organizations can ensure security against attacks on all crucial hardware equipment and network.
Of course, it’s very hard to track any information about real projects because they are kept highly confidential, but the adoption trend is positive for blockchain. For instance, in December 2017, U.S. President Donald Trump has signed a $700 billion military spending bill that includes a mandate for a blockchain cybersecurity research.
Smart contracts are ideal for law infrastructure. In most scenarios, smart contracts can replace existing instruments of creating powers of attorney. Contracts are program code that executed regardless of the will of the parties concerned. It can replace middleman (lawyer) involvement in the legal process. Most routines like property valuations also can be automated and become much more objective. With the current realization of modern blockchain systems, we can create very sophisticated and multi-step contracts that may cover full process from filing an application to deal closing.
For instance, the Aragon project was born to disintermediate the creation and maintenance of organizations. Everyone should have equal access to governance and collaboration, no matter of their race, gender or age. The project was originally started by Luis Cuende and Jorge Izquierdo in November 2016.
Stampery project enables users to certify the existence, integrity and ownership of any file or communication using the bitcoin blockchain. All the proofs generated by Stampery are automatically generated, impossible to modify, damage or destroy and valid globally – forever – even if Stampery disappears.
Blockchain is known as ‘killer of today’s monetary and banking system’ due to its reliability, transparency and decentralization. There are new types of platforms like TenX, Bankera, Crypterium, Bancor, which functionality allows one to pay bills directly using cryptocurrency or provides banking services.
But banks can use benefits from blockchain infrastructure. The most tricky issue in the banking system is transactions. To ensure transaction correctness and security, today’s systems use centralized databases with different access levels.
Weaknesses of this solution are the speed of transactions access and the single-point-of-failure nature of security. If hacker gains control over the central system of traditional architecture he will gain access to all accounts and transactions.
With distributed infrastructure hackers needs to gain control of the significant amount of nodes to verify transactions and even in this case changing account history will be impossible. It means that transactions can only be made inside the bank infrastructure and returned after the attack.
Another point is transaction speed. In blockchain, it depends on block timings and capacity. Many of blockchain realizations can process transactions in sub-second intervals – down to a millisecond – that can significantly reduce operating expenses.
Most of the blockchain projects in the energy industry are focusing on creating peer-to-peer electricity market and micro-payments for exploitation.
Electricity market tries to reduce overall costs by removing third-party agents. Furthermore, blockchain enables customers to directly trade electricity with each other in a ‘peer to peer’ way.
Micro-payment services also help minimize or eliminate third parties, add versatility for customers and improve security. Micro-payments became a popular idea even before blockchain was released and can be very useful in a wide range of industries.
Here is a video that demonstrates how a street in Brooklyn is using blockchain technology to decentralize and share electricity.
Ready to build the next big thing in blockchain?
If you want to implement your business idea using blockchain, you should seize the advantages blockchain offers and avoid its weaknesses.
VironIT can help you create a blockchain app tailored to your business demands and leverage the advantage of blockchain technology. Contact us today for an intuitive and fast solution for your business or enterprise.