Introduction To The Applications Of Blockchain

 

The blockchain market is possibly the fastest growing industry the world has ever seen because of the speed at which information travels nowadays. Blockchain is one of the contributing factors in transforming the economy globally and is becoming part of our everyday lives. Blockchain is the internet of money or we can say the internet of value.

 

Blockchain's key features include security, transparency, decentralization, immutability, and programmability, combined into a platform that does not need any centralized trusted intermediaries in order to process a transaction's value and information transfers. By doing so in a direct peer to peer way, the blockchain creates a completely new paradigm for global business.

 

Blockchain has the potential to fix many problems on a global scale. An enormous number of industries have become inactive and inefficient thereby proving unstable in their current state to grow economically, create value, or solve existing problems.

 

The financial sector is one of the sectors to be immensely affected by blockchain technology. Blockchain can bring new efficient solutions to various financial services and products contributing to the financial sector such as money transfers, global trade financing, insurance, and security trading, etc.

 

The Blockchain technology can improve various sectors such as accounting and audit, healthcare, media, consumer goods, internet and logistics, and supply chain management.

 

  

Perhaps many companies are using illegal and immoral ingredients in their foods and other consumer products, which is often being discovered when it is too late. This is where blockchain technology comes into action. They can help remedy and prevent counterfeit consumer goods.

 

A startup called wabi has taken the responsibility to solve these kinds of problems by combining blockchain and combining RFID (radio frequency identification) technologies. They can track and verify the authenticity of all ingredients and components used in consumer goods.

 

Another example can be of a company called everledger which is working to resolve the longstanding issue with blood diamonds. The aim is to track the origin of each diamond and record it on the immutable database. Similarly, other start-ups are aiming to solve the problems of counterfeit art and other luxury goods with blockchain technology.

 

Blockchain is becoming part of our everyday lives. For example, it can improve the way we make payments and investments. It can be incorporated into how we register our properties. It can help in verifying our identity and even how we vote in elections.

 

 

The idea of using the technology of blockchain with its various applications brings huge potential to the world. Various areas or applications where the blockchain technology has been used are as follows:

 

 

Blockchain is frequently referred to as the internet of money. Bitcoin, the first implementation of blockchain technology is the leading cryptocurrency.

Cryptocurrencies allow people to store their money securely making payments without intermediaries such as banks. This renders money transfers and purchases much simpler, faster, and cheaper. Therefore blockchain provides a great infrastructure for monetary systems, since we can store and move money on it efficiently.

 

 

Financial assets can be further extended to include all kinds of financial and real assets such as stocks, bonds, derivatives, commodities, and real estate. These can all be managed and transacted much more efficiently on blockchain compared to traditional systems.

 

 

Another great implementation of blockchain is in the supply chain management. Many companies are already actively developing blockchain solutions to monitor logistics in real-time to track and verify the origin of goods entering their supply chains and the conditions they are kept in. This can help certify the origin and lifecycle of products and build trust in the system.

 

It will prevent fraud and improve outcomes for both suppliers and consumers.

 

 

Another great example of blockchain implementation can be luxury goods. Items such as diamonds are among the first areas where blockchain projects are innovating to provide transparency, security, and trust. Providing such efficiencies to the luxury goods market can unlock a lot of value by reducing counterfeiting and promoting higher ethical standards. The authenticity verification feature of blockchain is very important for luxury goods.

 

 

Another application of the security registry features of the blockchain is in the intellectual property. A timestamped record on a blockchain could register any kind of copyrights, patents, or trademarks.

 

Therefore we can use blockchain to verify the authenticity of pretty much any asset.

 

 

Digital identity is another huge area of application for blockchain. It is related to the authenticity of people and their personal information. One of the first areas where such I.D. verification solutions are gaining attraction in the financial sector, with the demand for 'know your customer' (KYC) and anti-money laundering processes.

 

Therefore blockchain is great for managing physical and intangible assets and valuable information.

 

 

Steemit is a decentralized blockchain-based social network that uses native cryptographic tokens to reward users for contributing content participating on the platform. In this way, users are incentivized to post high-quality content and build an active community.

 

 

 

This helps create strong network effects which then boosts the value of the whole network and its native tokens. In this way, blockchain helps create self-sustainable economic systems that align incentives for all stakeholders and distribute value fairly. This aspect of blockchains is known as crypto-economics.

 

 

ICO is a fundraising technique primarily used by startups to use services related to cryptocurrency. The ability to issue digital assets directly on the blockchain and distribute them among a global community is beneficial for startups and venture capital. This helps companies in gathering investors to raise funds for their companies. Investors receive cryptocurrency tokens which they can utilize in using a company's products or services.

 

Along with raising capital and funds, this new alternative provides the important benefits of establishing a broad community of users and network effects which create additional value for startups.

 

 

Whenever any startup wishes to raise funds using ICO, it generates an informative document which describes what is the scope of the company, the need the companies targets will attain after completion, amount of money to be required, the number of cryptocurrency tokens investors can get, and the duration of the ICO campaign.

 

During the ICO campaign, all the supporters who want to invest in a particular company buy some of the cryptocurrency tokens by paying fiat or digital currency. The cryptocurrency tokens are similar to shares of a company sold to investors as well as tokens can be used to utilize company services or buy their products.

 

 

In this article, I have given a brief introduction to blockchain technology, along with its subsets cryptocurrency and bitcoin. I have explained how blockchain technology can improve various sectors to improve the economy globally. I have also discussed a few examples describing how blockchain technology can help people or companies all around the world. Finally, I have also discussed some of the applications of blockchain technology.