You must have seen that the terms Bitcoin and blockchain are often used interchangeably. But while Bitcoin’s success may have shown people the potential blockchain as a technology has, the blockchain goes above and beyond cryptocurrencies. Bitcoin is only an example of a blockchain application; other industries can benefit from it equally. Enterprises can use this ground breaking technology to cut down their costs and increase transparency of their operations. Innovators are now exploring different ways to use this technology to revolutionize traditional business models across industries like healthcare, fintech, supply chain, tourism, etc.
Key benefits of using the blockchain technology in a business:
- Higher Transparency: The blockchain technology makes information available to one and all because it is a distributed public ledger; all data on it is recorded after being verified by computers or nodes spread all over the world. This is why it can guarantee 100% transparency which is lacking in most industries. Because of centralization, transparency continues to be one of the biggest roadblocks. But the blockchain changes all this; it allows enterprises to be decentralized and operate without middlemen by boosting the system’s transparency. This advantage offered by the blockchain enables governments to consider enhancing their transparency in conducting voting and deploying government processes.
- Reduced Expenses: Businesses are always on the lookout for new technologies that can bring down their costs and streamline operations further. The blockchain technology allows them to do just that by eliminating the expenses associated with maintaining third-party vendors. In the absence of centralization there is no further need for intermediaries in business operations. Furthermore, the absence of third parties also means that transactions can be faster because interactions are fewer.
- Higher Security: The biggest benefit that this technology offers businesses is security; blockchain guarantees advanced security measures compared to any traditional record-keeping system. All transactions that are added to the blockchain are first verified and approved by thousands of nodes in the network. Moreover, all transactions are encrypted using a unique hash method. This ensures that there can be no instance of double-spending. If the data in any block were to be changed it would alter its hash. This would create a domino effect and even if a malicious actor tried to do this, he will fail because other computers in the network that have an identical copy of the blockchain would reject this. So, data in the blockchain stays immutable and cannot be tampered with; once written, it cannot be erased or changed.
- Higher Speed and Efficiency: Blockchain offers higher efficiency and greater transactional speeds so that money-transfers can be quick and seamless. It seeks to resolve the time-consuming process associated with conventional money-transfer systems and eliminate human errors through automation. The blockchain makes it possible through its public ledger system which stores records of all transactions.
- Traceability: Using this technology, companies can now create a supply chain capable of working with both suppliers and vendors. Earlier, supply chain systems were plagued with issues like counterfeit, thefts, loss of products, etc. But, with the blockchain technology in place, it is possible to now track goods to make sure these are not misplaced or misused.
To conclude, businesses should invest in this only after performing a strategic evaluation of it to see if it suits its business model.