Blockchain Role in Various Industries
Despite the fact that the blockchain became a popular technical concept in 2008 as the main technology for implementing Bitcoin, at present, its scope covers many business industries. We will talk about what blockchain can be used for below.
5 Use Cases of Distributed Ledger Technology
In fact, the future of blockchain has already arrived — literally from the moment developers began to apply this technology to solutions not related to the crypto industry. Therefore, we propose to consider specific use cases for blockchain technology in the context of non-crypto solutions.
Fast transactions without intermediaries
Let’s start our list of blockchain technology use cases from high-speed and low-fee transactions. In particular, one of the main goals of creating distributed ledgers that are now on everyone’s lips (Bitcoin, Ethereum, Solana, etc.) was to provide end users with a simple tool for making payments without the participation of third parties. Initially, the speed of transactions in such solutions was insufficient, and the commissions were sometimes quite high.
However, as they improved (and in particular as consensus algorithms were optimized), these shortcomings were gradually eliminated, and today digital payments using the blockchain are completed in a few seconds, with very moderate fees. Thus, this decentralized solution introduced the world to a universal tool for fast, low-fee transactions without intermediaries.
Smart contracts
Another one of the most typical blockchain use cases is smart contracts. In fact, these are the same contracts from real life that have been optimized and transferred to the digital plane. They are executed in real time and do not require the involvement of third parties. That is, smart contracts are devoid of all the shortcomings that are inherent in traditional ones. In practice, they significantly save money and time resources of companies, while ensuring the proper level of transparency.
IoT
Among the most perspective blockchain applications in real life is the IoT industry. In particular, the combination of blockchain and the Internet of Things (IoT) is one of the most promising scenarios for using this decentralization technology outside of the cryptocurrency market. In particular, in the context of IoT, the distributed ledger can solve the problems of scaling, privacy, and security.
While today the IoT industry largely relies on centralized services, this model is unlikely to be a long-term solution for the mass design of IoT solutions in the future. In turn, the transfer of data and internal services to the blockchain can help IoT reach its full potential and provide a higher level of security, protection from unauthorized access, lower costs, no need for third parties, as well as process automation.
Security
Blockchain is a decentralized data ledger that, in addition to storing information, can act as a source of truth. This gives blockchain users confidence that the information in the system is genuine and cannot be changed without the consent of all participants in the transaction. Thus, the correct use of the blockchain eliminates the possibility of fraudulent actions. Also, thanks to the blockchain, companies can begin to use more secure distributed ledgers than in the case of traditional databases, optimizing the procedures for registering and verifying users in the system.
From a technical point of view, the blockchain is a secure, endless transaction journal that can be used not only for financial operations but for everything with a formal value. The security of the technology is due to three factors: a distributed ledger, cryptographic encryption, and a consensus algorithm. Thus, the protection of blockchain-based solutions from external threats is ensured thanks to the combination of these three factors.
Proof of intellectual property rights
Given that the blockchain can contain any digital information about transactions, legal documents, and media files, including photos, videos, and audio, this technology can be used in the field of intellectual property.
In particular, the protection of intellectual property using the blockchain is implemented as follows: first, the user creates a record, for example, on the registration of a trademark, then the blockchain grows as any transactions are made with this trademark (for example, it is used in commercial activities, or another company is licensed to use it, etc.). As a result, the entire life cycle of a particular object is tracked using the blockchain.
7 Industry Applications of Blockchain
Even though one of the most obvious use cases for blockchain is the banking sector, this industry could collapse due to over-hyped decentralization. Even though some banks (such as Citigroup and KB Financial Group) try to integrate blockchain-based solutions into their current business processes and do it quite successfully, the global transition to decentralized services risks “killing” the banking industry as a phenomenon.
So, should you be afraid of blockchain disruption in the context of your business? We think that the correct implementation of this technology can bring many advantages to the existing workflows in your company. Below we offer a closer look at the industries that benefit from the use of blockchain.
Public sector
One of the most promising applications of blockchain technology is legislation. Since the blockchain excludes the possibility of changing or erasing the data that is placed into it, this technology has been actively used in storing legally significant data — for example, contracts for the sale of real estate or works of art, transfer of intellectual property rights, etc.
For example, Estonian government implemented the most highly-developed national ID card system in the world. Much more than a legal photo ID, this blockchain-based solution also provides digital access to all of Estonia’s e-services.
Medicine and healthcare
Blockchain in medicine and healthcare is a great opportunity to make data processing simpler, faster, and more understandable. However, it is worth noting here that traditional forms of blockchain-based on popular consensus algorithms like PoW are not suitable, since they are characterized by a low data processing speed (due to the fact that adding each next block implies verification by all nodes).
Another limiting factor is local regulation of the collection and use of personal patient data. Therefore, in addition to developing a blockchain-based solution, companies also have to be puzzled by its adjustment to the relevant regulations.
As for real examples of blockchain use, let’s consider a BurstIQ platform which helps healthcare companies safely and securely manage massive amounts of patient data. Its blockchain technology enables the safekeeping, sale, sharing or licensing of data while maintaining strict compliance with HIPAA rules.
Logistics and supply chains
The next one of the most developing blockchain industries is logistics. Blockchain can be used as an electronic waybill to track the route of delivery of goods from the supplier to the buyer. Thus, this solution can replace traditional CRM systems. Moreover, the new technology has an advantage over the old one: CRM systems are subject to hacking, alteration, or data deletion. In turn, once placed on the public blockchain, the data remains there forever and cannot be deleted or changed.
For instance, Microsoft Azure uses blockchain to simplifies logistics tasks and, in particular, tracking items along supply chains, helping companies follow compliance standards.
Counterfeiting
Blockchain technology can also be extremely effective at detecting counterfeit products, which can be relevant for luxury goods manufacturers and their end consumers. In turn, blockchain-based product authentication protects both the brand and the consumer.
For example, blockchain is already being used by LVMH (clothes, shoes, and accessories in the luxury segment), as well as Tracr (diamond industry).
Electronic voting
Due to the invariance of the data stored in the distributed ledger, some digital companies have decided to transfer the voting procedure to the digital plane, offering their target audience absolutely safe and transparent online voting solutions that use advanced cryptographic algorithms.
For example, a Ballotchain electronic voting system helps to organize the voting procedure to ensure the correct performance and fair outcome of the process.
Game industry
Among other applications of blockchain, this one refers to the entertainment industry. For instance, to solve current problems in the gaming industry and increase user loyalty, developers use blockchain to create new games. For example, this technology can be applied to attract new users to the game with the help of rewards in the form of tokens, make it possible to own game objects via NFT, conduct microtransactions in the game (as an option, to purchase game items), monetize games through ICO, validate the value and protect game assets, etc.
If we talk about real examples of blockchain implementation in the game industry, it is impossible not to mention CryptoKitties, a famous cat-collecting game, where the most valuable game item was sold for 600 ETH.
Insurance
The main problem of the insurance industry is outdated business models that only partially or do not use digital solutions. In turn, blockchain technology will help insurance develop thanks to smart contracts, cost reduction due to the absence of intermediaries, as well as the ability to operate with large amounts of data (data will be stored in one place and will also be available for verification).
In terms of real life examples, we recommend you pay your attention to the Ryskex solutions that provide insurance agents with the ability to manage risk directly through a blockchain-provided platform.
Conclusion
So, what can be said about blockchain technology’s future? As you can see, this technology has long gone beyond the solution for which it was originally introduced to the masses (we mean Bitcoin) and successfully masters new business areas. In particular, in many cases, it allows companies to streamline and eliminate deficiencies in business processes, which was previously not possible with the use of other digital technologies.
We hope that our article has given you the impetus to implement blockchain in your business and now you have a clearer idea of how it can help you close the gaps in the efficiency of your workflows.
