At its core, blockchain is a distributed ledger technology (DLT) that provides a secure, immutable, and transparent method for recording transactions and managing assets across a network.
Originally developed as the underlying framework for cryptocurrencies, such as Bitcoin, blockchain’s potential extends well beyond its initial financial applications. It has unique capabilities that provide integrity and veracity of data without a centralized authority, which make it an attractive option for multiple industries and verticals looking to improve their operational transparency and reduce inefficiencies.
This technology does two things that are critical to business growth: it streamlines processes and it significantly lowers costs associated with cross-verification, compliance, and fraud prevention.
As enterprises look to harness this technology, exploring the expansive scope of blockchain applications reveals opportunities that could positively impact business operations, governance structures, and compliance standards across global markets, which is what we’re going to be covering in this article.
Before we begin, one thing that should be made clear is that blockchain technology generally presents a trade-off from a business perspective – developing products and solutions that can be managed using blockchain technology can mean a higher burn rate. This becomes relevant because if your solution doesn’t directly make use of the benefits of blockchain, then just using it for the buzzword might not be the best business decision.
This being said, here are some real-life applications of blockchain:
Supply Chain Management & Logistics
Blockchain transforms traditional practices with its capacity for real-time tracking from production to delivery. This improved transparency can mean a significant reduction in inefficiencies, fraud, and errors along the supply chain. One example is the retail giant Walmart, who has effectively implemented blockchain to track the journey of food items from farm to shelf throughout the whole supply chain. This integration improves food safety in a number of ways, off the top of my head because it allows fast tracing in contamination events or because it improves overall traceability, which obviously translates into consumers receiving fresher products.
The adoption of blockchain in this sector has already helped companies comply with regulatory standards more efficiently, manage recalls, and strengthen consumer trust by providing a clear, unalterable record of product histories.
Intellectual Property & Royalties Management
In creative and software industries, managing intellectual property and equitable distribution of royalties have always raised significant challenges. Blockchain technology can be used in this immutable ‘ledger system’. This system enables creators, artists, and software developers to register and verify the ownership of their creations with unprecedented ease and security. Smart contracts can automate royalty payments, which guarantees that creators receive timely and fair compensation for the use of their work, and this automation streamlines the payment process in the obvious way you’d expect, but it minimizes disputes, reducing the potential for human error.
Identity Verification and Management
Identity theft and fraud are increasingly common threats, blockchain offers a solid framework for secure and verifiable identity management. It allows enterprises to improve employee verification processes and onboarding experiences for customers. By implementing blockchain, companies can better ensure strict adherence to data protection regulations, with the obvious benefit of reducing the risk of personal data breaches. A good existing example in identity management is Estonia’s e-Residency program, which provides a government-issued digital identity to global citizens. This program helps individuals worldwide to start and manage EU-based businesses online more easily.
Cross-Border Payments & Settlements
This application allows businesses to conduct international transactions that are faster, more cost-effective and transparent compared to traditional methods. By eliminating the need for intermediaries, blockchain reduces transaction costs and shortens settlement times.
This capability is a promising new standard for global businesses that often face delays and high fees when dealing with international transfers. The inherent transparency also adds a layer of security and trust, because all parties involved can view transaction histories and verify information without discrepancies. This is the type of level of efficiency and reliability that’s particularly relevant in our global economy.
Lean & agile means that business growth has to be prioritized everywhere, and payments can be a bottleneck or an enabler of growth.
Data Security & Integrity
Industries that manage sensitive information, such as healthcare and finance, can particularly benefit from blockchain’s capabilities. The list is potentially very long here but a top-of-mind example is healthcare, where blockchain can secure patient records, or in finance, where it can protect transaction data from fraud and theft. These sectors have a fundamental interest to safeguard their data and to cultivate trust with their clients, knowing that their information is handled with the best standard of security.
Blockchain – The Path Forward
As blockchain matures, its applications across various industries are expected to grow exponentially.
Whether you’re a CTO eyeing the next tech leap for your company or a startup on the cusp of scaling, blockchain technology offers a promising horizon beyond crypto. It’s an exciting time to be in technology, and even more so to be exploring the boundless potential of blockchain for enterprises.
