High rates of development of such technologies as blockchain and cryptocurrency attract more and more attention from the most various business niches. The distributed ledger method - when data, instead of being stored in a centralized database, is distributed among many network participants while stored locally - can be a great security AND efficiency booster for any business activity.
As such, all the transactions taking place in this network are checked by independent participants and then are registered in the global history of operations. By data blocks, you can thoroughly monitor the integrity of each deal. At the same time, currently available global blockchain technologies allow for all operations to take place immediately, anonymously, and without the involvement of additional specialized third parties.
Blockchain, Business Adoption - Key Moments
The cryptocurrency tech opens new opportunities for company owners. To boost the overall business market value and get the maximum effect from your efforts of adopting blockchain, you should consider and learn a bunch of important aspects.
Security
You provide a truly valuable service when you offer the following:
- hashing of confidential data, passwords;
- replication of any data copies throughout the whole network;
- an inability to change or delete the history of operations.
You can reach all that without involving blockchain as well. Most systems are based on the centralized management block, however, which can be easily breached, undermining the confidentiality of all the data and security of deals.
Decentralization
In terms of defining the concept of decentralization, this type of blockchain infrastructure can be considered both centralized and decentralized at the same time: there is a single decision-making point that verifies operations taking place between participants, however, data copies are stored throughout the whole network. There is no universal blockchain model - a certain type is settled based on a particular case.
Smart contracts
The following scheme of nodes demonstrates the general idea of a smart contract.
Cryptocurrency
The implementation of crypto financial operations doesn’t necessarily require the involvement of blockchain. The necessity appears when there is a need to secure the transaction network from any third parties so that everything works directly with the client. Note, however, that in such case, vendors have to take up additional responsibility and three major questions should be clarified with your developers:
# Do ✅ Don't do ⛔ 1 Specify the task this way: “I want to provide my customers with the possibility to pay for goods with the most famous cryptocurrencies on my website” Specify the task this way: “Integrate ERC-20 standard into my website payments” 2 Speak this way: “Why do we have Master Nodes? I didn’t see them in Ethereum architecture, and I thought that we planned to do something like that. How can we delete them from the architecture? What will it lead to? Speak this way: “I’ve seen an Ethereum architecture, there are no Master Nodes. Delete the master nodes from the architecture, but keep the same functionality.” 3 Delegate the review of technical decisions to a special person loyal to you Review all the technical decisions yourself and approve/decline them yourself, even if you don’t have any expertise
After these clarifications, try to find an independent technical specialist that will verify the answers.
Blockchain Business Ideas
For one thing, the technology of blockchain finds the widest and most efficient implementation in business niches related to finance - payments, transactions, emission and selling of securities, etc.; it can also be fruitfully applied in the agricultural business. Sky’s the limit here, really. All in all, blockchain helps optimize existing business processes, increase the reliability of important operations, as well as provide new types and ways of cooperation.
Finance
According to expert analysts’ predictions, global saving rates due to advanced technologies are to reach US$20 billion by 2022; 65% of banking establishments are also expected to employ the blockchain technology in their commercial operation by 2020. These predictions are based on the major benefits and opportunities, such as:
- Payments. With the adopted blockchain business model, payment operations become decentralized. This allows for avoiding slow and expensive payment networks.
- Identification. The distributed ledger nature is utterly precise at verifying the client’s goodwill and legal aspect of the processed assets.
- Asset transactions. Blockchains along with smart contracts allow making up deals in the form of a valuable asset. Blockchain boosts and security the efficiency of clearing, calculations, and storing. Smart contracts reliably encrypt the process log, rules, and related information.
- Insurance. Automation of insurance requirements’ processing and inclusion of certificates in smart contracts reduce the scam chances and increase the speed of claim processing.
Non-financial niches
As we’ve already mentioned, the blockchain technology is a universal way to process and store information in any type of business, non-financial niches are not an exception. In particular, it can also be utterly efficiently applied in:
- government control - the distributed ledger helps optimize the aspects of taxation, issuance of passports, distribution of pensions, land surveying, etc;
- energetics - alternative energy suppliers get a great ability to establish service for distributing their assets;
- education - transparent documentation helps decrease cheating rates and boost the document checking processes;
- cybersecurity - transferring and verification of data can be based on advanced cryptographic methods, decreasing the efficiency of hacker attacks.
Blockchain is also either already actively employed or is looking to be implemented throughout the niches of medicine, predictions, analytics, network technologies, Internet of Things, entertainment, advertisements, car leasing, travel, human resource management, etc.
The Business Value
Reliability, integrity, decentralization, and transparency of blockchain make it an all the more attractive piece of cake for businesses of various levels, opening new promising horizons and opportunities. Three major values we can highlight are:
Blockchain doesn’t have to be a disintermediator for value generation
Verified systems are integrated with private networks with limited access and editing capabilities. Thus, the leading companies save their dominating role and get an all-around protected way to form connections with other large players to work on large-scale projects. The anonymity of transactions allows for conducting value creation experiments before implementing the idea full-on.
The long-term prospects of disintermediation depend on the mental and commercial readiness of everyone involved to implement blockchain. However, the situation should be controlled by the government, preventing possible threats for countrywide banking systems.
Blockchain lowers expenses in the short-term perspective
Experts from the Morgan Stanley bank predict that financial establishments are to lower expenses by 50% thanks to blockchain. The implementation of an encrypted database also allows reducing the team of specialists that verify every operation, dropping the basic expenses by 35-50%.
An ability to conduct payments independently from one’s geolocation and involvement of intermediaries will positively affect the retail financing and international transactions.
The felt reduction of the number of intermediaries along with thorough optimization of many processes are the major blockchain benefits that can lower your business expenses dramatically.
Huge scaling opportunities in 3-5 years
Many European, American, and Australian companies apply blockchain in terms of the experiment. The veritable assessment of the result will become possible when the global scale of the technology implementation is achieved. For that, the following factors must be regulated:
- general standards & rules;
- technology infrastructure development;
- mass digitization of assets;
- critical mass of popularization.
Summary
The technology of blockchain opens new awesome growth opportunities for most various businesses. Security, automation, and transparency are the key benefits of the distributed system.
In turn, every other entrepreneur and business owner should consider the risks of additional responsibility as well as the experimental nature of this concept’s globalization. Several years may have to pass for it to be fully implemented on a global scale.
