This turn of the century is full of groundbreaking technological advancements and one of those that managed to change industries is blockchain. For people that are acquainted with blockchain only through crypto, you might find it surprising that blockchain can be used in other sectors other than finance. However, this technology by Satoshi Nakamoto is full of surprises!
Blockchain is a versatile system that can give answers to our modern problems in the voting system, data security and information sharing. One of the selling points of blockchain is its impregnable defence against cyber attacks. There are thousands of computers that record the data in a chain so it is impossible to alter any file that has already been processed and confirmed.
If you are interested to know more about blockchain and how it can help improve the economy as well as different industries, continue reading below.
What is blockchain?
Blockchain is a decentralized system that has an ever-growing account based on peer-to-peer (P2P) topology. Some people also know this as a Distributed Ledger Technology (DLT), which publicly files transaction data and other records called blocks in various databases called chains. What makes this technology secured and untouchable is the wall of cryptographic codes that it has for each block.
The blockchain is able to keep its system robust and functioning through the multiple miners involved in the gathering of data and solving complex mathematical problems to validate a transaction. For an added security to your files, every data recorded is stamped with an algorithmic signature known as a hash. Once the block reaches its maximum data capacity, it will be added to the chain along with other blocks.
Impacts of blockchain on the economy
Blockchain has been increasingly integrated into various industries in the world and this is because of the security that it provides as well as the decentralization of its system. Check out how it affects the economy below:
Blockchain protects you from a data breach by keeping your records open in a distributed ledger that is not linked to a single processor. What this does is that it provides you with accountability and transparency through a decentralized database. You have full control over your personal details and what you will allow the public to see.
Changing business landscape
Blockchain is a revolutionary invention that altered the landscape of business in unexpected ways. It made safe, digital transactions possible and opened the way for cryptocurrencies to represent real assets. In addition to this, it also introduced businesses to initial coin offerings (ICO) instead of the traditional shares or capital funding provided by banks, venture capitals and private equities.
Rise of virtual currencies
The emergence of blockchain heralded the rise of numerous cryptocurrencies like Bitcoin and altcoins. Crypto users opt to invest in cryptocurrencies because of the anonymity that it provides, as well as the absence of intermediaries in the transaction process. This doesn’t just lower the production cost for processing transactions but also allows you to confidently transact, knowing that there is no one meddling with your account.
Unlike bank transactions, disclosure of personal information is not necessary for blockchain and crypto users. If you look at it, crypto is the answer to the problems that people have with fiat currencies. The government is still cautious about the legalities of crypto, but their opinions are quickly shifting as more and more countries adopt the concept of digital currencies and blockchain.
The emergence of new industries and economic leaders
Since blockchain was created, it gave rise to digital wallets, crypto trading, initial coin offerings and alternative digital currencies, which became an industry of its own. Different companies emerged around the trade of crypto and opened new opportunities for jobs in the economic world.
One of the latest trends in the crypto scene right now that is introduced by blockchain are the NFTs or Non-Fungible Tokens. These tokens work differently from the regular cryptocurrencies wherein you can trade a Bitcoin for another Bitcoin. NFTs are unique. What makes it different is that instead of tokens, it uses real-world objects like music scores, digital arts, music videos and more.
This new addition to the crypto world boosts the value of arts in the industry while also giving people something new to look forward to in their trades.
Reducing operational cost + quick and secured international transaction
Blockchain technology has successfully secured and accelerated the business process in financial transactions across the world by removing the need for intermediaries. Aside from this, they also lowered the cost for transactions. What used to take days or even weeks to process for banks now only takes seconds with blockchain-powered transactions.
Aside from this, blockchain also helped paper-based businesses transition to digital verifiable processes allowing businesses to facilitate a quick international transaction.
Industries revolutionized by blockchain
With what was said above, it is clear that blockchain technology is beneficial in a wide range of areas. Take a look at the industries that blockchain influenced below:
Banking and financial services
When it comes to blockchain and the economy, the industry that receives the most impact from blockchain in the finance sector since blockchain is originally created for crypto transactions.
Blockchain simplified the banking process by introducing crypto payment options and eradicating third parties in the transaction.
Blockchain has a way to take the real estate industry to the next level by authenticating digital transactions, instilling a trusting relationship between buyer and seller through a safe and secured platform and reducing the siloed database.
Blockchain helps healthcare organizations to have better data collaboration that doesn’t just increase data accuracy but also upgrades the quality of treatment that the patients will receive. This is possible by streamlining the medicine verification process and the supply chain of hospitals.
Blockchain technology made record-keeping and verification of certificates for schools simple by introducing the concept of verifiable open badges that allows students to maintain a permanent record of their certificates and other school documents.
This is perhaps one of the most obvious effects of blockchain on the economy, it bridged the gap between the buyers and the sellers by removing the intermediary and making transactions personal for the two parties involved in the exchange.
Aside from that it also added a sense of security and transparency in smart contracts while also easing the process of peer-to-peer transactions.
Government and public records
The government might be having a rocky relationship with cryptocurrency, but even they agree that blockchain can improve the current system by lowering the paper-based processes, improving accountability in every domain and preventing risks of document fraud.
Blockchain creates a better tracking, casting and vote counting through its secured system that prevents any form of tampering with the data. This way, every risk of fraud voting will be eliminated and there will be more immutability, authentication and transparency in voting.
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