Decoding the Future of Blockchain
Blockchain is a revolutionary technology and is full of vast untapped potential. It started as a platform for digital currency and has slowly warmed up to become one of the future-oriented technology. Having said that, it’s only recently that it has finally shed off the tag of being limited to digital currency, and is starting to appeal to industry and people alike.
There are newer applications and usage of blockchain that are being perceived at present and will likely follow in the future. So how did it all start and what’s the likely future for blockchain technology?
Here’s a take on blockchain technology, its journey over time, and its likely future adaptation. Read along.
Blockchain and its Basics
Blockchain has been mainly perceived as the shared immutable ledger that facilitates the recording of transactions and assets in a decentralized network. It allows parties to view and record entries on the ledger which rhetorically is called blocks. These are protected by cryptography hence the basis for being a trusted transaction network. Although the prime usage of blockchain has been in digital currencies or cryptocurrencies, the potential for blockchain is vast and untapped.
There are various usages for blockchain apart from cryptocurrency and it’s something that is being looked at in different industry verticals. The anticipation that blockchain has a definite future outside of the cryptocurrency is widely accepted and it remains just a matter of time before its prominently used around. We here take a look at blockchain and its future adaptions into various industry verticals. But before that let’s trace back the steps and see how it all started.
Tracing Back the Journey of Blockchain
The very first idea for blockchain was floated in the year 1991 with a motto to store digital data in an unmodifiable state. The basic idea behind it was to create an open-source database that cannot be tapped or edited creating a secure decentralized system with transparency at the core of it. The same technology was adapted for the digital cryptocurrency namely Bitcoin.
Blockchain officially made its mark in 2008 and has grown into usage and acceptance. At present, the market size for blockchain is estimated to be around $1.06 billion with expectations of it reaching $10.45 billion by 2025. Several enterprises and organizations accept its existence, work process, and scope. It’s a reason why numerous usage of blockchain is being looked at present with the enterprises leading the search pack.
Present Day Usage of Blockchain
Blockchain has already been integrated and accepted into multiple platforms and ways apart from cryptocurrency. Here are a few examples of such adaptations:
1. Facilitation of Cross Border Payments: Cross border payments have always been marred with the notion of being expensive and slow. The traditional route of transferring money across international terrains requires a lot of regulatory procedures and currency exchange which costs money and time. The use of blockchain can negate the need for currency exchange and heckles of regulations. This can reduce the time and costs involved and process the cross-border payments swiftly. A notional comparison between the traditional and the blockchain method will show that traditional methods cost as much as 20% of the remittance money as fees along with over a week while blockchain costs a mere fraction and simply minutes for the transaction to be processed. However, there are certain caveats for blockchain-based cross-border transactions which still exist and will likely be resolved soon in the future. This can make it a great option for such transactions.
2. Identity Management: Identity management is a big issue in this modern-day internet penetration age. As much as people look to secure their identity, the cases of thefts and security breaches aren’t uncommon. These can be tough and can cause financial and image complications. The traditional way of storing identity across online platforms isn’t as secure as one may think. Blockchain can prove to be a capable replacement due to its decentralized and secure network. Digital currencies remain safe due to this factor. Leveraging the secure attribute of the blockchain platform can allow for safe identity management. Data like voter information, electrical data, real estate ownership, ration details, and more can be stored safely in the blockchain.
3. Smart Contracts: Smart contracts mean contracts that are self-executing and self-enforcing guided by computer programs. Smart contracts are widely based on blockchain technology and have been successfully used by many people. The application of smart contracts can be implemented into multiple verticals and applied to create a self-enforcing contract. Not only does this provide a limitless option to scale and extend the contract to multiple areas but is also time-saving. It is a matter of time before smart contracts are integrated into various business procedures and applications.
4. Ensuring Efficient Supply Chain Mechanism: Businesses are often defined by the handling and running of their processes. A good organization often has efficient processes and functions helping it grow. Supply chain mechanism is one such major process that often can be the maker or breaker of a business organization. Ensuring the smooth functioning of supply chain mechanisms is the key to long-term growth and sustainability. Blockchain technology has been used by many business organizations in a bid to ensure efficient functioning and error-free process of supply chain mechanism. The added advantage of using blockchain to ensure efficiency in supply chain mechanisms is that it eliminates the need for human intervention, significantly reducing the chances of error.
What Is the Future for Blockchain?
The vast potential and usability of blockchain in other industries apart from digital currency are now being widely accepted across the globe. This has given rise to different avenues and adaptations of blockchain some of which we discussed in the aforementioned section. Here are some of the industry verticals and areas likely to see an adaptation of blockchain technology in the upcoming future:
1. Banking and Payments: With digital currency or cryptocurrency entirely based and facilitated by blockchain technology, it’s completely normal that the next step would likely be banking and payments. We already read how cross-border payments have integrated blockchain to some extent. The upcoming future is likely to see the banking vertical adopt blockchain technology for security and transparency. It can also see banking and payment procedure shift towards blockchain-based mediums. Developing nations and a few major developed nations have started a trial adaptation of the same with the hope for full integration in the future.
2. Insurance: If banking and payments are looking to integrate blockchain technology, then it makes every bit of sense that the insurance industry will look to do the same. The insurance industry as a whole uses multiple ledgers and structures of data that are collected throughout. Any claim process or policy-related activity requires the service provider to go through the database to validate the claim and further process it. This requires time and can be hectic at times. Utilizing blockchain technology can allow the insurance industry to keep a distributed ledger with unique verification ability. This can allow them to independently validate multiple documents and process the claims at a faster speed.
3. Government: This might come as a surprise, but governments across the globe are warming up to blockchain technology. Reserve Bank of India (RBI) has also approved of research on using blockchain as a payment medium while over 90 central banks across the globe have been engaged in the Distributed Ledger Technology (DLT). This can mean a supportive stance towards blockchain technology by central banks and governments in the future. Utilizing blockchain technology can not only help the government in the financial aspect but also in streamlining bureaucratic processes. Government across the globe and India can utilize the blockchain to create a transparent mechanism with a reduction in bureaucratic red tape and holdups.
4. Predictive analysis and forecasting: The relativity of predictive analysis over here is in regards to forecasting and not to the analysis part. Blockchain technology can be used to create a predictive market with a decentralized approach. With its vast decentralized data storage, this can help predict various streams of activities and data like traffic models, weather, revenue generation, inflation, and more.
5. Voting: The news of discrepancy in voting and counts isn’t something unheard of. It’s a recurring theme for the electoral process across the globe. This can be accredited to the inefficient mechanism and various jargon in the data structure. Using blockchain can eliminate such issues and enhance the efficiency of the voting procedure as a whole. It will also result in improved security and reliability whilst also allowing accessibility.
6. Retail Sector: The retail industry has been lamented for the involvement of middlemen. It’s something that has affected the major parties involved in the entire retail process, i.e. producer/manufacturer, seller, and the end consumer. Eliminating middlemen can eradicate the issues around the retail industry and smoothen the entire process. It can also mean competitive prices for the consumers and a greater share of profits for the producer or the seller. Using various applications like smart contracts and decentralized payment methods can significantly benefit the retail sector.
7. Real Estate Industry: If there’s any sector that is constantly affected by the clouds of bureaucracy, middlemen, frauds, and regulations, it’s the real estate sector. These things have affected the entire industry which in turn creates a domino effect resulting in shabby and weak infrastructure for the end consumer. Using blockchain can break the barriers and reduce the impacting factors whilst also improving the assistance levels for the real estate industry. Blockchain technology can revolutionize the way the real estate industry functions for good.
Wrapping Up
Blockchain can be a fascinating technology or an opinion dividing one based on how you perceive it. Some people are completely mesmerized by the potential of it while some are dismissive of it. However, regardless of it, it has and will likely be a revolutionary technology to be ever developed. Having started as a premier technology adapted for digital currency to be one of the future-proof technologies, the course has been fascinating for blockchain. And with the future looking bright, blockchain is likely to cause a revolutionary change in many industry verticals and sectors.
