Blockchain has changed how we perceive problems. It has brought tons of benefits.
In this article, we will be going through the benefits of blockchain technology, its advantages, and learn how its benefits from key sectors out there.
Blockchain technology solves key issues like trust in a network. By changing the key parameters, trust, any organization can focus on solving the problems at hand. Global governments have also understood its importance and are keen on implementing blockchain technology. Dubai Smart City 2020 is a project which aims to build a smart city with new technologies, including blockchain.
So, what are the benefits of blockchain technology? Let’s first go through the top 5 blockchain benefits for the industry.
Top 5 Blockchain benefits for the industry
If you are working in the industry, then you should know the advantages of blockchain technology, i.e., its benefits. It will help you learn about the upcoming changes if your business is currently getting blockchain or plan to implement blockchain in the future. Let’s get started.
Transparency is one of the big issues in the current industry. To improve transparency, organizations have tried to implement more rules and regulations. But there is one thing that doesn’t make any system 100% transparency, i.e., centralization.
With blockchain, an organization can go for a complete decentralized network where there is no need for a centralized authority — improving the transparency of the system.
A blockchain consists of peers who are responsible for carrying out transactions and validating it. Not every peer takes part in the consensus method, but they are free to choose if they want to participate in the validation process. To provide validation through decentralization, the consensus method is used. Once validated, each node keeps a copy of the transaction record. This way, the blockchain network handle transparency.
The transparency has bigger implications when it comes to organizations. As mentioned earlier, governments can also utilize the transparency in building government process or even conduct polls.
Blockchain utilizes advanced security compared to other platforms or record-keeping systems. Any transactions that are ever recorded needs to be agreed upon according to the consensus method. Also, each transaction is encrypted and has a proper link to the old transaction using a hashing method.
Security is also enhanced by the fact that each node holds a copy of the transactions ever performed on the network. So, if any malicious actor ever wanted to make changes in the transaction, he won’t be able to do so as other nodes will reject his request to write transactions to the network.
Blockchain networks are also immutable, which means the data, once written, cannot be reverted by any means. This is also the right choice for systems that thrive on immutable data such as systems that citizens age.
Right now, businesses spend a lot of money to improve to manage their current system. And, that’s why they want to reduce cost and divert the money into building something new or improve current processes. By using blockchain, organizations can bring down a lot of costs associated with 3rd party vendors. As blockchain has no inherited centralized player, there is no need to pay for any vendor costs. On top of that, there is less interaction needed when it comes to validating a transaction, further removing the need to spend money or time to do basic stuff.
With blockchain, companies can focus on creating a supply chain that works with both vendors and suppliers. In the traditional supply chain, it is hard to trace items that can lead to multiple problems, including theft, counterfeit, and loss of goods. With blockchain, the supply chain becomes more transparent than ever. It enables every party to trace the goods and ensure that it is not being replaced or misused during the supply chain process. Organizations can also make the most out of the blockchain traceability by implementing it in-house.
Improved speed and highly efficient
The last industrial benefit that blockchain brings is improved efficiency and speed. Blockchain solves the time-consuming process and automates them to maximize efficiency. It also eradicates human-based errors with the help of automation. The digital ledger makes everything of this possible by providing a single place to store transactions. The streamlining and automation of processes also mean that everything becomes highly efficient and fast.
The fact that everything is stored in a decentralized ledger also makes it easy for everyone to trust each other. In short, blockchain utilizes its unique way of data storage to provide a highly efficient process with trust, transparency, and immutability.
We hope that all the above points have answered your question on what are the key benefits of blockchain technology.
To give you a better glimpse, let’s list the advantages of blockchain technology that you get by using blockchain for your project.
Advantages of blockchain technology
There are many advantages to using blockchain technology compared to other traditional technologies.
- With blockchain, your business process will be better protected with the help of a high level of security
- The hacking threats against your business will also be reduced to a greater extent.
- As blockchain offers a decentralized platform, there is no need to pay for centralized entities or intermediaries’ services.
- Enterprise blockchain technology enables organizations to use different levels of accessibility.
- Organizations can do faster transactions with the help of blockchain.
- Account reconciliation can be automated.
- The transactions done are transparent and hence, easy to track.
Now, with the impact of industries clear, it is now time to go through the list of sectors are taking advantages of blockchain technology. Let’s get started.
Benefits of Blockchain in Different Sectors
Almost all the sectors out there can benefit from the blockchain. Out of all the sectors out there, the four sectors that we think benefit the most include Education, Healthcare, Finance, and Government.
To get a glimpse of exactly how different industries are taking benefits of blockchain, let’s go through each one of them briefly.
Benefits of blockchain in Trade Finance
Trade finance benefited immensely from the blockchain. It required some form of reform to solve the problems it is currently facing. The benefits of blockchain in trade finance include the following.
- Data integrity: With blockchain, the trade finance sector improves when it comes to data integrity, authenticity, and proper asset provenance.
- Streamlined process: Automation also became a norm due to blockchain dApp and smart contract capabilities. It improved overall process efficiency, including the ability to do real-time settlement. The process also became error free due to the non-involvement of intermediaries.
- Programmable: With blockchain, organizations can now code multiple aspects of the business, including data privacy, governance, identity management, and so on.
- Market reactivity: Using digital security also means that trade finance organizations can make changes when the need arises. In simple words, it offers customization.
- Cost reduction: Using an automated network means cost reduction, including transactional, operational, and infrastructural.
Benefits of blockchain in Energy Sector
Energy distribution, allocation, and production have always been an important sector for governments out there. Without proper energy management, it becomes hard for any government to provide valuable growth to its economy. Private players also play a crucial role and can benefit from the blockchain. Below are the benefits that the energy sector receives with the use of blockchain.
- Environmental sustainability: Blockchain helps make the energy sector more environmentally sustainable. It helps overcome legacy energy sector efficiency issues and provides a network where it is possible to produce, store, and distribute energy more efficiently.
- Reduced costs: The costs associated are reduced when it comes to infrastructure and operational aspects of the energy sector.
- Improved transparency: The use of a distributed ledgers improves transparency.
Benefits of blockchain in Real Estate
Real Estate sector’s condition has not been so good for the past few years. That’s partly because of the ever-increasing price, but also because of how frustrating it has become to buy a property. Blockchain has brought a new fresh outlook on how the real estate sector operates. It offers multiple benefits, including the following.
- Tokenization: With blockchain, it will become possible to tokenize actions. This means that properties can be rented out for a certain period using pre-defined code. Tokens also make it possible to add any business logic, including the ability to protect against fraud.
- Proper tenant and investor identity: Digital identities can help both investor and tenant to create digital identities that are easy to verify and work with. The KYC/AML procedures will become more streamlined with the use of proper identity management. Lastly, documentation becomes more easy and shareable.
- Property sale: Property sale can be automated with smart contracts. It enables legal agreements that are traceable and executable if a certain condition is met.
- Real-time accounting: With blockchain, it is possible to do real-time accounting
Benefits of blockchain in Government
Many governments around the world are not in favor of the cryptocurrency, but they do understand the importance of blockchain and what it has to offer. The government can utilize blockchain in many ways, and the benefits include the following
- Proper identity management: The government can use identity management for every citizen. This way, they can manage the transactions, credentials, and also do data management.
- Do elections: They can also utilize the blockchain to do transparent elections where there is no chance of frauds
- Finance management: Engage in a better way to do finance management. They can also allocate budget with transparency, efficiency, and effectiveness.
Benefits of blockchain in Healthcare
Healthcare also requires a complete change if they want to be more effective in providing service to their patients. Blockchain brings a lot of benefits to the table. Let’s go through them below.
- Universal patient profile: The use of a decentralized ledger means a unified patient profile. Patients do not have to carry their papers anymore as everything can be stored and shared through a secure ledger. It will also stop the errors happen due to report storage and usage.
- Drug traceability: Drug traceability will also improve with blockchain. As everything is tracked in real-time and in a decentralized network, there are next to impossible chances for it to get hampered.
- Better clinical trials: Patient’s data is secured and stored in a decentralized network. The public health data can be used to do better clinical trials and research — improving the chances of developing drugs for different diseases.
- Electronic Health Records(EHRs): With blockchain, health organizations can easily manage electronic records.
This leads us to the end of our key benefits of blockchain technology topic. You can also check a comprehensive article covered on the topic here.
We hope that by now, you have understood the importance of blockchain. Blockchain is a revolutionary technology with a huge impact on every sector out there. Our focus was only on the main sectors so that you can relate and understand its advantages.
So, which sector do you think will be most impacted by blockchain? Comment below and let us know.