“Blocks” otherwise known as a list of digital records are secured by cryptography creating a ledger of transactions, once verified the record enters the chain and cannot be changed. Leading players in the world of blockchain are the likes of IBM, Microsoft, and Intel although there are many other high profile companies with an ever-expanding interest in the technology.
Blockchain is an ever-popular technology that has become the infrastructure for many applications in the world of finance, the most famous example being “bitcoin”. However, blockchain has many other, arguably more important, applications in the world of business.
When multiple parties require a common record, use blockchain technology
Applications of blockchain in finance range from new forms of clearing and settlement to supply chain finance, the company Everledger, for example, uses blockchain to guarantee the provenance of diamonds. Not only specifically relegated to finance, but blockchain also has other applications in business such as data storage and potentially even helping build customer-business relations if transparency is a fundamental part of the relationship. The National Health Service (NHS) uses a form of blockchain technology for its databases and record-keeping. However, it is important to keep in mind that leading experts in the industry have clarified that blockchain is best used when multiple parties require a common record, which would include applications such as insurance or voting where the internet plays a large role.
Blockchain is also making progress in the world of business security, particularly in areas such as fraud, given that it’s almost impossible to tinker with the blockchain without it being noticed. The accuracy of records increases and the back office processes are simplified through blockchain making transactions irrevocable. As blockchain is digital, almost any asset or document can be expressed in code and then expressed in a ledger entry.
Undeniable benefits of blockchain
In the business world the transparency that blockchain provides is catching interest from those in supply chain management and who are interested in catching out fraud. There are now many examples of high profile companies making use of blockchain. Kodak created a photo intellectual property platform on the blockchain which opened for the initial coin offering on 21st May 2018 with a $50 million ceiling. A form of cryptocurrency called KODAK coin has been created and will be used to pay photographers who work on the platform, which itself is built to constantly crawl the web looking for intellectual property infringements. Another large company interested in blockchain is Toyota, which is using blockchain for driverless car insurance data. Toyota will take motoring data, generated by the usage of cars, and store it in a trusted location. Given the huge complexities created by the field of insurance when combined with driverless cars, this should be a much-needed solution in terms of informing insurance rates.
Another example is MasterCard, who filed a patent for their blockchain money transfer patent. MasterCard has stated that it wants to develop a “method and system for instantaneous payment using recorded guarantees”. The technology could lead to an irrefutable record of transactions, payment networks, and produce a response code to verify the payment. Meanwhile, Da Beers, a diamond business, has successfully traced 100 high-value diamonds from mine to retails along the supply chain for the pilot of its blockchain platform. The CEO of Da Beers, Bruce Cleaver, then claimed the success of this “pilot” proved that a diamond can be traced through the supply chain in a “way that was not possible before”.
Blockchain is a relatively new technology and it is rapidly changing. There are many ways you can use it but it must be done after good preparation. We can watch and learn from big players how to adapt to changes and hopefully learn something for ourselves.