Blockchains are no longer just a computer science term for how to structure and share data. Today, they are considered as a novel way to approach the distributed database. In short, a blockchain is a data structure that makes it possible to create a digital ledger of data and share it with a network of independent parties. Public blockchains such as Bitcoin are large distributed networks that are run by a native token. Permission blockchains such as ripple can control roles that individuals can play within the network. They also use a native token and the code may or may not be open source. Private blockchains are usually smaller and do not utilize a token. Their membership is closely controlled.
For all these types of blockchains, cryptography is used to allow each participant in the given network to manage the ledger – eliminating the need for a central authority to enforce the rules. These blockchains are capable of creating a permanent record and histories of transactions. When data is entered in a blockchain, it is extremely difficult to change or remove it.
Blockchain has disrupted the economic landscape and is not just a new way to do business, but it’s changing the business itself. It is built to solve the pressing problem and the need to verify transactions without the authority of a central server. It has a linked series of blocks or transaction records with accompanying time stamps and data. It effectively prevents the alteration or falsification of transactions. It also eliminates the need for a central banking authority. With blockchain, users could finally trade directly with each other through digital currency.
How are various businesses using this technology?
- In logistics, blockchain saves carriers billions of dollars. Cargoes can now be shipped with a significant reduction in paperwork costs. All transactions are confirmed and captured on the distributed ledger system. This dramatic cost reduction measure will definitely impact trade on a global level.
- Ethereum technology has been implemented to create a secure data-sharing infrastructure for the healthcare space. Hospitals can now share medical records securely and efficiently through blockchain.
- In legal cases, blockchain based smart contracts allow individuals to conduct transactions securely without the need for a middleman such as a notary or a lawyer.
- The blockchain technology prevents ticket scalpers from selling concert and sports tickets at inflated prices. The public ledger system is used to verify and guarantee ticket prices. The system keeps the bots from hoarding tickets and reselling them on secondary markets. This effectively reduces ticket fraud, counterfeiting, and other problems associated with online ticket buying.
- Above all, blockchain has potential advantages for the environment. The companies in the energy sector to are using blockchain systems for efficient peer to peer distribution of electrical energy.
As a greater number of companies realize blockchain’s implications, there will be a paradigm shift in the way businesses work. The rules that have existed for decades – even centuries – will shift. Industries will move away from the traditional centralized models towards a system where individuals control transactions. This emerging technology has a number of interesting areas of untapped potential. While it’s impossible to predict what the future might hold, this technology will change the business world as we know it!