Blockchain: Potential Beyond Cryptocurrencies

“Blockchain has a branding issue,” says Martha Bennett, Vice President and Principal Analyst, Forrester Research. The branding problem resulted from blockchain’s tight relationship with cryptocurrencies and Non-Fungible Tokens (NFTs). The vast majority of people only identify blockchain with the very volatile cryptocurrency market. But there are other applications for technology too. Speaking about the core use of blockchain, Vitalik Buterin, the co-founder of Ethereum, the most commonly used blockchain, had said, “Whereas most technologies tend to automate workers on the periphery doing menial tasks, blockchains automate away the center. Instead of putting the taxi driver out of a job, blockchain puts Uber out of a job and lets the taxi drivers work with the customer directly.”

Businesses in virtually every industry can benefit from blockchain technology. With faster, more secure electronic processes, they can cut out unnecessary management systems, improve operations, and maintain a level of privacy that was pretty much unheard of before. And for industries that handle loads of data and information, blockchain technology makes everything so much easier to manage. Thus, there is a lot more to explore when it comes to blockchain. We will dive into that but first, let’s do a quick refresher on the blockchain.

“Blockchain has a branding issue.” —Martha Bennett, Vice President and Principal Analyst, Forrester Research

What is Blockchain?

A blockchain is a distributed ledger that records transactions chronologically. The information is accessible to all, tamperproof, and verifiable. But the most interesting aspect of blockchain technology has to be smart contracts. These were introduced by Ethereum. What’s so special about them, you ask? Well, they’re self-executing contracts; once the conditions mentioned in the contracts are met, they execute on their own. And the best part? Blockchain makes smart contracts fully secure, transparent, and immutable. Smart contracts and distributed ledgers could be the answer to companies searching for new solutions to improve customer service, streamline operations, and ensure transparency to customers and regulators. 

A Chain for Real Use

As more and more companies are on a path of digital transformation, there is a massive influx of data due to digital records. This must be securely managed. This is where blockchain comes in, catching the attention of C-suite executives. Here are some of the ways blockchain is transforming industries:

Financial Services  

Blockchain technology is breaking new ground with peer-to-peer transactions, Decentralized Finance (DeFi), and neo-banking services globally. In Africa, more than 350 million adults are economically excluded and live paycheck to paycheck without the security of a bank account, credit card, or loan options. In these countries, blockchain-based Decentralized Finance is the only financial service they can access. And they are lapping it up! Africans received $105.6 billion in blockchain payments between 2020-2021. That’s a 1,200% year-on-year increase.

Supply Chain Management  

“Anything that can conceive of as a supply chain, blockchain can vastly improve its efficiency- it doesn’t matter if its people, numbers, data, money,” marked Ginni Rometty, CEO of IBM. Up until recently, databases and paper trails were the only ways to monitor the supply chain. The visibility was low due to lack of co-ordination among the partners. This often caused shortages and led to inefficient product and service deliveries. With blockchain, it’s possible to have complete visibility of the supply chain. Moreover, smart contracts can be used to execute and terminate leases, which helps to reduce legal costs and improve financial management. In the automobile industry, Renault Group switched its supply chain documents to blockchain. Other companies followed suit. 

The De Beers Group has taken blockchain in supply chain management to the next level by introducing the world’s first blockchain-backed diamond source platform. They called it TracrTM, and it starts at the source and provides tamperproof source assurance at scale. This means that Sightholders can provide an immutable record of a diamond’s provenance. And jewellery retailers can be fully confident of the fair origin of the diamonds they purchase.

Healthcare  

Blockchain can help in improving the sharing and coordination of medical data leading to better patient outcomes. The technology can improve traceability and transparency in the pharmaceutical supply chain. Innovative companies like Chronicled and Curisium have harnessed the power of blockchain to create systems that transform how stakeholders authenticate their identities, log contract details, and track transactions. With this secure and decentralized platform, the entire network benefits from heightened trust and efficiency, revolutionizing the way goods and services flow within the healthcare ecosystem.

Blockchain can also be used for patient record management to enable companies to simplify claim processing, securely store medical records, and collaborate with network stakeholders. And with a blockchain-based record management system, patients have greater control over their data while also ensuring that it remains secure and accessible to healthcare providers.

The Bottomline

Therefore, beyond the murky waters of NFTs and cryptocurrencies, enterprise blockchains are set up in a way that they can bring true business value with much less risk. With more applications in government, humanitarian aid, media, and real estate, we have barely scratched the surface of the technology. Just as the internet and mobile phones changed our lives — that is the potential blockchain holds.

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Written By: Poorva Sagar