One of the hottest business topics right now besides artificial intelligence and machine learning is the blockchain. Why? This technology will radically transform the way you do business in more than one way. Many businesses are already deploying this technology in creative ways, from tokenization as a part of supply chain management to digital surveys and stockholder voting.
There are many applications well beyond some — ones that nearly any business can implement. Although the blockchain initially created specifically for handling Bitcoin, it quickly spread to not only other cryptocurrencies but more creative applications as well.
As the technology merges with other business applications, it is spreading more rapidly each and every year. The blockchain is already making an impact and is part of the future of nearly every business. How will it affect yours in the coming year? Here are three examples:
1. Show Me the Money
The blockchain originally created to deal with bitcoin, and the digital currency rapidly became a favorite of black market criminals and drug dealers. The currency is not control by a central bank, and so although the value fluctuates, it is not easily traceable. Transactions cannot be altering once they entered in the blockchain, so transfers are extremely secure.
The blockchain is essentially a secure ledger stored on the computers of all parties to a transaction. Unlike a traditional ledger, only new information added to it. Information already in completed blocks that make up the chain cannot be altering. This makes all transactions transparent, secure, and tamperproof. Businesses and individuals desire these attributes for other financial transactions as well. Thus the blockchain, even if not used for bitcoin transactions, can serve as a digital record of more traditional ones.
However, when it comes to the future of business, it is likely that blockchain-based cryptocurrencies such as bitcoin will become a more acceptable form of payment. Already you can use your digital wallet filled with cryptocurrencies to pay for Microsoft products or to shop for furniture on Overstock.
The primary issue now is the volatility of the cryptocurrency market. Unless a business converts digital coins to dollars or another controlled currency, it would be worth twice or half as much the next day. Equally, the consumer who pays for goods using cryptocurrency may not know if they got a good deal or a poor one.
This is changing though, as even countries are beginning to accept cryptocurrency as part of everyday life. There are even crypto ATMs where you can convert your cash to digital coins, although these are still rare. It will not be long before a business who does not accept digital currency will be akin to one who did not take credit or debit cards a decade ago.
As early as next year, it could be imperative for your business to determine a way to accept digital currency for goods and services or risk being left behind. As long as you are using a secure wallet system that is well established, it is easy to protect your bitcoin or other cryptocurrency.
2. Client and Corporate Privacy
One of the primary applications of the blockchain that is being explored is for the keeping of digital records. The reason? They cannot be accessed without the proper digital identity and credentials, and even once accessed cannot be altered. For instance, to change a client’s address, you would need to create a new block, and then use the most recent one when accessing their information. The one you entered before cannot be altered.
These digital records offer unique advantages over traditional ones, and many banks and other companies are exploring blockchain options. Think of the potential of unalterable transactions that are secure but once accessed are also transparent.
One of the clear applications is education, and while this application of the blockchain is still in the works, schools and other institutions are excited about its potential. Assessments, degrees, grades, attendance, and other vital records could be stored on the blockchain in a much more secure manner than they are now.
Beyond more client-facing records though, internal documents such as human resources information, payroll, and other records will be stored in secure chains that will make software data hacks nearly impossible. Without the proper credentials of an individual with access permissions, the blockchain becomes nearly impenetrable.
These internal documents can include upcoming projects, patents, creative ideas, and other items highly desirable to corporate spies and potential competitors. It is nearly certain that the blockchain will impact the digital security structure of your business in 2019.
3. Smart Contracts
While it is great to have a contract with someone, for it to be effective it must be enforceable. Nevertheless, what do contracts have to do with the blockchain? Simple. The blockchain, with its unalterable data, use to create contract enforcement automation.
Let us use the example of the lease for your business location. With a smart contract, the terms are entering into an unalterable block. Included in the block are both your bank and that of your landlord, or to take things a step further, both of your crypto wallets. If rent is due on the fifth of every month, funds are transfer automatically at 12:01 a.m. on the due date.
Since there are dates attached to the lease, the stipulation can be easily set that once the end date of the lease is getting reach, if a new block is not being create with a new lease, the payments stop or even continue at the same rate on a month-to-month basis until a new one supersedes the current block.
This is a very simple example, but thinks of your contracts with those in your supply chain when it comes to pricing, or purchase commitments from your current customers. If their banks and yours are connected and unalterable stipulations are set up in the blockchain, altering of the contract becomes much more difficult. Electronic delivery notifications and even input from smart devices can be included in the block to verify the receipt of goods. Until the expiration date of the contract or a superseding block, the current terms can be continue automatically.
Lawyers are already embracing these smart contracts as potential solutions in a number of applications, and your business will probably be offer one in 2019 if you have not been already.
The use of blockchain in a variety of applications is inevitable. From currency to security, to legal contracts, it will influence nearly every type of business not only in the coming year but in the years to come as well.