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The term blockchain refers to a set of technologies used to make immutable blocks of data that could be connected in a virtual chain. Any transaction that occurs in a blockchain network is permanently copied and distributed across the entirety of all participating computer systems. Additionally, all participants may view any of the data blocks at any time. In this way, a blockchain may provide an unalterable and trustworthy method of sharing all kinds of data.
Blockchains, as we know them today, are based on Distributed Ledger Technology (DLT) and cryptographic techniques. While there may be slight differences in how different blockchain systems are executed, modern systems work in broadly the same manner. These systems are innovative in that they allow for a way to guarantee the security and quality of data without the need for a third-party guarantor.
Blockchain technology is what makes digital assets like cryptocurrencies and non-fungible tokens (NFTs) possible. Accessing these encrypted assets is done through an appropriate digital wallet, such as the popular Monero wallet. These wallets give users a public key that others could use to send cryptocurrencies and NFTs. Users can then use a private key to decrypt and access their assets.
Cryptocurrencies and NFTs are, by far, the most well-known use of blockchain technology. However, businesses are leveraging blockchain technology in new and exciting ways. Below are some of the ways businesses are leveraging blockchain technology.
1.) Easier Remittances
International commerce is highly dependent on banks and other financial institutions to act as intermediaries between different entities transferring money across international borders. This necessarily means that there are costs to sending money overseas, even within the same organizations.
Blockchains are already being used to significantly reduce the cost of cross-border transfers. Typically, this involves converting regular fiat money into cryptocurrency or an NFT, which is then transferred to a different entity overseas, without the need to go through a financial institution. The blockchain asset is then directly used as currency or exchanged for regular cash if needed.
2.) Smart Contracts
In the near future, blockchain solutions are perhaps going to have a big impact on the world of contracts. Using blockchain technology effectively allows legal contracts to become unalterable and practically impossible to forge. This could be a game-changer for businesses that handle large volumes of customized contracts, such as insurance providers.
So-called “smart contracts” facilitated through a blockchain may allow insurers to quickly eliminate duplicate and invalid claims. The high trust and integrity of such systems may also allow better automation of compliance and reporting requirements, cutting down the time to approve claims and release cash to insured parties.
3.) Transparent Supply Chains
Money and contracts are not the only things that could be verified and kept safe through blockchains. Today’s highly dispersed and interconnected supply chains are already starting to make use of the advanced security benefits that blockchain technology offers.
Walmart, the largest retailer in North America is currently using blockchain technology to secure billions of discrete inventory items and pay suppliers on time. Combining blockchain tech with smart automation has allowed the retail chain to effectively cut down the time needed to reconcile different data discrepancies and approve invoice payments for suppliers. The time savings has led to a series of cascading efficiency improvements that have effectively increased revenue for the retailer.
The shipping giant Maersk has similarly used blockchain tech to increase the visibility of different shipments in real-time. This effectively cuts down on the need to manually verify shipments, resulting in massive wins in efficiency. Using this tech also helps keep cargo from being lost due to human error, helping to further reduce the cost of global shipments.
4.) Simplified Human Resource Management
One way blockchains are already used in human resource management is to quickly authenticate and automate payrolls. Private blockchains are already being used to vastly streamline the delivery of employee payrolls. This faster, more transparent method can be especially beneficial for international businesses with potentially thousands of employees, consultants, and freelancers on their different payroll systems.
Eventually, individuals’ entire professional records could be stored on a blockchain that’s unique to them. Educational profiles, work experiences, and relevant credentials could be added to the chain by employers. Data on the blockchain could be used to easily determine the authenticity of an applicant’s stated work experiences. This has the potential to simplify the tedious verification process in HR management.
5.) More Efficient Healthcare Delivery
As mentioned earlier, blockchain technology can be used to produce secure smart contracts for insurers, which could mean timelier health insurance payouts. However, it may also soon be used in a more direct lifesaving capacity.
Blockchain tech is being explored as a way to store basic patient information in a way that still helps keep identities safer. This can allow medical service providers to quickly share vital information as needed without serious privacy concerns. This may eliminate data siloing in healthcare, speeding up access to lifesaving information.
This information may then be safely stored on a blockchain that is unique to the patient and could be accessed in any hospital throughout the world. This provides total visibility of an individual’s health record. In the future, this could be synthesized with wearable devices worn by patients that will constantly update the system with vital stats that could be tracked over time.
How Do I Learn More About Blockchain Tech?
There is a lot of misinformation out there about blockchain technology and its applications. Given the growing role this technology is playing in our day-to-day life, it’s best that everyone truly understands the concepts behind it. Popular applications like cryptocurrency and NFTs can give people some practical insight into how the technology works today and learning about it from an academic standpoint can only help increase its potential in the near future.
Photo by Hitesh Choudhary on Unsplash