In today’s society, lack of trust and security are part of our everyday lives. The blockchain technology can solve these current concerns since the system is completely trustworthy and transparent. The technology could help many industries and economic sectors such as education, politic, management, Internet of Things and many others.
What makes the technology so unique is that no intermediaries would be necessary since it is a decentralized and distributed ledger. Currently, with centralized systems, the data is only stored in one location, which makes it more susceptible to fraud and loss of information. On the other hand, on a decentralized system, the data is stored on a network distributed throughout many computers (or nodes), which cuts the middleman and makes the information incorruptible.
The blockchain is an increasing list of transactions also called “blocks” that are always recorded, placed in chronological order and verified, so that if something wrong happens, it is easily traceable.
According to the Harvard Business Review,
“With blockchain, we can imagine a world in which contracts are embedded in digital code and stored in transparent, shared databases, where they are protected from deletion, tampering, and revision. In this world every agreement, every process, every task, and every payment would have a digital record and signature that could be identified, validated, stored, and shared. Intermediaries like lawyers, brokers, and bankers might no longer be necessary. Individuals, organizations, machines, and algorithms would freely transact and interact with one another with little friction. This is the immense potential of blockchain.”
Different Applications of the Blockchain
Currently, a lot of banks are working to implement the blockchain technology since the speed of money transfers or real-time transactions is much higher.
Also, there wouldn’t be no more waiting for money to hit your bank account. The transactions would be much safer since the middleman would be cut and the data would be stored across multitude of nodes. The technology would also have a big impact on title transfers.
Because of the immutable characteristic of blockchain, arguments between two parties regarding a contract would be significantly decreased. Since the data registered on the ledger is impossible to modify or alter, title or property transfers could be done automatically by the blockchain without any litigation.
Another interesting facts of the technology, is that financial statement audits could be done autonomously by the blockchain in a secure and trustworthy way.
It wouldn’t necessary to hire expensive accountancy firms because the transactions are recorded in real-time and are impossible to alter so money transfers could be audited automatically.
Since the whole data is verified and encrypted in the blockchain using cryptography it eliminates the risk of being hacked or lose money, which is more prominent in a centralized system.
Internet of Things (IoT)
Since the Internet of Things includes many things such as cars, buildings and refrigerators connected to a network with sensors, it is primordial to have a decentralized system running it. A centralized system would be much more susceptible to be hacked since all the data is stored in a central location that controls communication between devices.
The blockchain technology could also eliminates corruption from politics. Using the technology would increase transparency and security and diminish bureaucracy.
Ben Dickinson recently told VentureBeat; “because of the distributed ledger structure of blockchain, votes could be stored in many independent nodes (i.e. different locations), which would make modifying or tampering with votes “theoretically impossible.””
In blockchain voting, each voter could be assigned a wallet (a sort of user identifier or credential), and a coin (that is, a chance to cast a vote), the results of which would be stored in various nodes.
The blockchain technology can disrupt many industrial sectors and a massive adoption might come sooner than we think as big corporations such as Walmart, IBM, and Amazon are talking about implementing the technology to their ecosystems.