How Blockchain Technology is Revolutionizing Products and Services in Various Industries

Blockchain technology

The underlying technology that Bitcoin and all different digital currencies rely on provides users with a decentralized, democratic platform for exchanging value peer-to-peer.

The founder of Bitcoin (Satoshi Nakamoto) and the neighbourhood of designers who successfully worked together to establish the network's genesis block deserve a lot of credit for creating blockchain technology and cryptocurrencies a fact. That said, digital money is only one use case for the blockchain. The truth is blockchain technology and other exciting decentralized tools like smart contracts are revolutionizing development and benefit offerings across multiple different enterprises and verticals.

Term and term again, learning that blockchain technology applies to so considerably better than cryptocurrency – ironically enough – inspires Canadians to buy Bitcoin in Canada and obtain in on the act. There are many other aids to consider in learning about Bitcoin and other digital currencies specifically. However, in this post, let's concentrate more on how the blockchain changes other characteristics of our lives.

What is Blockchain Technology? What is a Blockchain?

  • A blockchain is a decentralized database. Decentralization means there is no focal point of attack for hackers to expose. 
  • Instead, information kept on the database is secured by computers who validate data as genuine. 
  • The data appears to be related to transactions and payment information in digital currency. 
  • In a broader sense, however, the data can be anything.
  • It can be a deed house, the rights to a piece of land, the rights to a rare antique, or an understanding between two parties that stipulates all of the details of a service agreement.
  • A blockchain can be either public or private. Furthermore, most digital currencies like Bitcoin exist on top of public blockchains. It means everyone can visit the data stored on the blockchain, and there is no special permission required to contribute to its development or access the information held on it. 
  • In a private blockchain, central management or constituents might have special administrative power over who can look at the details stored on the blockchain and what those people can access. Some digital currency blockchains, like Ripple, allow partial access to the public while at the same time maintaining ownership of the blockchain as a private entity.

Let's explore more specific use cases for blockchains and how general and permission blockchains differ in real-world scenarios.

XRP, Ripple and Central Banks

The XRP token represents the Ripple cryptocurrency. Anybody can own the token and profit from its price appreciation. In that logic, Ripple is a publicly subsidised project. However, the token and the blockchain that facilitates its value exchange is owned by a personal company called Ripple Labs. Public blockchains that host cryptocurrencies allow the community of users to secure the web and benefit from its improvements or the price appreciation of its token or currency.

The team that owns Ripple, however, is interested in profiting privately. The project's goal is to serve central banks, which is something cryptocurrency purists don't like. Serving central banks means helping a centralized authority, which in the minds of many libertarians means facilitating the privatization of value exchanges, not democratizing value. Ripple's end game permits central banks to exchange large volumes of money at a fraction of the banks' costs. The purpose is to increase profit and put it into the pockets of business people and bankers, not hard-core libertarians.

Ethereum and Smart Contracts

Ethereum is built on a public blockchain and is the world's second most valuable cryptocurrency according to market capitalization. It was developed by a team including Russian-Canadian programmer Vitalik Buterin.

The project introduced the world to the concept of the smart contract. A smart contract is a digital agreement between two parties that lives on a blockchain; in hosting a smart contract, the blockchain stores all the relevant data related to terms and conditions and outcomes that render the contract fulfilled. There is no need to use an intermediary or escrow service to guarantee a transaction with smart contracts.

Consider how a company, like the online auction website eBay, guarantees transactions using their payment service, PayPal. PayPal ensures the product gets delivered to the buyer upon receipt of payment. The seller gets paid once they provide proof of shipping details to the buyer and the shipping company notifies PayPal that delivery is complete. In exchange for facilitating, PayPal and eBay charge as much as 15% in selling fees and charge the buyer to withdraw capital into their bank account. Transactions on a public blockchain using a smart contract mean costs can amount to mere pennies because no central authority or profiteer is taking a cut.

Other Use Cases for Blockchains

Blockchain technology doesn't just store data related to monetary value. There are many other reasons to use it. The space industry will one day be able to use satellites outside the atmosphere as nodes for storing or validating information. The sector will also be able to store data associated with energy consumption and construction details related to projects orbiting our planet.

IBM already uses blockchain technology to store data related to every aspect of its global supply chain. It allows the company to track the shipment and servicing of every part of its business on a permissioned decentralized database that gives key stakeholders entrance to all relevant information to do their work.

Blockchain technology is also being utilized in artificial intelligence to store machine learning data securely. It allows an artificial intelligence robot like Sophia to carry on a detailed conversation with Hollywood actor Will Smith during a dinner date. It also gives her developers insight into how fast she's learning and ensures that malicious hackers aren't manipulating her progress.

The Future of the Blockchain

The numeral of use cases for the blockchain is almost limitless. As long as data must be secured, stored or fast transmitted to another party, part of the solution is possible. As the world of technology and cryptocurrency resumes to evolve, broader use issues for blockchains will be more exhaustive.

Thanks for reading. Written by Ayelen Osorio of Netcoins

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