What is your idea of an ideal world? If you ask me this question, I would say a world which is friendly, positive and trust is the strongest ingredient in its architecture. To me, this is no less than a fairyland dream today. But the question is, can it be reality tomorrow, is it feasibly achievable or what steps should be taken.
If I look at this dream as a challenge, I can think about multiple issues to address at many different levels. And biggest of all those is TRUST, a deep-rooted, powerful belief which every business wants to built. Its oxygen for sustainability of businesses and customer retainment. The technological solution which has potential to help achieving it is Blockchain.
Blockchain shifts trust in people and institutions to trust in technology, Schneier(learned American cryptographer, computer security professional) said.
The whole point of using a blockchain is to let people — in particular, people who don’t trust one another — share valuable data in a secure, tamper-proof way.— MIT Technology Review
Blockchain is most talked about technology and looks promising to help most of the Fourth Industrial revolution ambitions. I will give you many reasons to prove this in my paragraphs below.
What is Blockchain
I will try my best to explain it in simply “non-geek” words here, Blockchain is just a chain of blocks where blocks mean the digital record keeping ledger. Now these block must have some important qualities like Identical, transparent, verified, non-editable, distributed and trustworthy.
Because technology is innovation of human minds and human mind is meant of real life experiences, lets try to understand it in real life situation.
In rural regions or small Indian towns, there is similar practice followed by people and grocery shop owners. When people go to buy a household item at street’s corner grocery shop they take a small diary with them. They don’t prefer paying cash for each transaction rather they borrow from shopkeeper and settle accounts by paying him monthly. So this dairy plays an important role to maintain a ledger of all transactions. A similar dairy is maintained by Shopkeeper too. So, after every purchase shopkeeper records it in both the diaries and customer verifies it. In this way, the record keeping becomes distributed because its not owned by single party, identical because every transaction has an entry in both copies, transparent & verified because both parties know whats recorded and have access to it and all these qualities makes it trustworthy.
But wait, one issue that still persist here is editability, any single party can however edit the amount in their own diary but of course this will result in mismatch between the two copies and indicate that there is some fault entry done.
Now, multiply the number of transactions to billions of crores and also replace the two parties involved with multiple stakeholders. So, this technique becomes unmanageable and less maintainable unless technology helps us achieve it.
The story above is the simplest explanation of Blockchain from my own personal life experiences but of course Blockchain has much more to offer. There are many good Blockchain explanations available to go deeper into it, some of which I will also mention at the end of this blog.
“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” – Don & Alex Tapscott, authors Blockchain Revolution (2016).
Potential to create a big change
Blockchain has all the capability to become center of attraction of this decade in technology arena. If you ask me why so? I will say the bigger and wider the problem becomes, the greater the importance given to solutions. The best analogy here is most talked about Electric vehicles as replacement of fuel based vehicles which cause pollution.
Businesses today does not operate in silos, they are network of multiple partners, investors, supplier, distributors, channel partner etc. With such structure they have there own boundaries and maintain database in separation. Often when they need to exchange data with each other the question of trust arises. This has become need of the hour to address these problems and built a single source of truth which makes it all trustworthy.
Blockchain reduces vulnerability and increases transparency in all business sectors because information is stored digitally and does not have a centralized point or an intermediary to carry out the transactions.
What World has to say
A very recent survey done indicates that adoption level is already booming. They say nearly all industries are realizing its potential and stepping in to acquire the early bird advantages.
The 2019 Gartner, Inc. Hype Cycle for Blockchain Business shows that the business impact of blockchain will be transformational across most industries within five to 10 years.– Meghan Rimol (source: Gartner)
“Even though they are still uncertain of the impact blockchain will have on their businesses, 60% of CIOs in the Gartner 2019 CIO Agenda Survey said that they expected some level of adoption of blockchain technologies in the next three years” said David Furlonger, distinguished research vice-president at Gartner.
Industries to benefit most
Good news is any industry which deals with multiple stakeholders, has a customer journey and wants to establish trust will be benefited with adoption of this technology.
But specifically talking about Trust the first thing what comes into picture is Value/Money. Hence few Industries with immediate impact are:
- Banking and Financial services :
“We see blockchain in several key areas in banking and investments services, primarily focused on permissioned ledgers,” said Mr. Furlonger.
Today this industry has big challenges due to huge number of transactions and rising aspiration of beneficiaries, which often leads them getting trapped until bankruptcy. Think about a technology which can atleast help in indicating faults at an early stage due to decentralized nature reduce enormous risk situations.
2. Supply chain management :
There is huge potential because every physical asset that is a part of the supply chain ecosystem is represented as a digital asset on the Blockchain network. This is also known as tokenization of assets, which enables increased traceability of products in the supply chain by helping identify the point where food/drugs have been tampered with so that product that is either tampered with or gets contaminated is removed before it reaches the store shelves. This track and trace feature of Blockchain allows customers to track the journey of a product right from the point of origin till store shelves.
3. Healthcare :
Healthcare is an industry which deals with long and often painful journey of its customers with so many parties involved around any certain or uncertain situations like healthcare service providers as hospitals, insurer, brokers, claim management services, and support services etc.
– Medical practitioners lack a understanding of a patient’s medical history. This hinders in providing effective healthcare solutions.
– Insurance Claim process is often painful for customer.
– Counterfeit or fake medicines are also a major issue within the medical supply chain.
– Customer gets irritated of re-iterating same story about an incident to different parties and that too in a situation where they need more time for self-recovery from physical and mental trauma.
4. Voting :
Because Blockchain has capability to address the problems of digital identity at its best, it can be best adopted solution for organizing true voting campaigns along with keeping anonymity of voters maintained.
5. Asset Management and Notarization:
Because world is moving towards digital, all assets will soon be managed digitally instead of paper which makes it more vulnerable to tampering. The tamper-resistant and transparent feature of blockchain makes it a suitable candidate for notarization. Blockchain can be used in notarization to ensure proof-of-existence. Blockchain helps in proving the existence of the document since the time it was created and modifications can also be detected. Verifying if a document has been altered or not can be done by hashing the document. If there has been any change, the document will result in a different hash and the owner will become aware of the alteration.
The list is long and reasons are even bigger. I will also try and elaborate some real scenarios and how Blockchain can address those in my next blog, so keep looking for it.
While concluding this post, I would say the past implementations of blockchain might have raised a sentiment of risk but bad examples are not complete story. Blockchain has already become a sensation and soon will become necessity.