Blockchain can help your business if used in the appropriate situation.
Blockchain is a hot buzzword right now, and company managers might be wondering if it’s something they need to “do” or add to their business. On the surface, you might think of it as “just that cryptocurrency technology,” and therefore nothing to worry about for your company. But blockchain is about far more than Bitcoin. Companies who take advantage of blockchain’s abilities now will be one step ahead because this technology is going to transform every industry.
What is blockchain?
Blockchain is also known as distributed ledger technology. At first, we heard about the technology less than we heard about Bitcoin, but that’s starting to change as people have realized the power behind the cryptocurrency system. Blockchain is a public, digital ledger, a record of new transactions or any other data.
In this shared database, people can add updates and reconcile accounts, but you can’t go back and change what’s already posted. That feature helps keeps things fair. People can view past transactions and know those can’t be changed, only updated. Blockchain transactions are hosted by millions of computers at once, a decentralized system that increases security.
Such descriptions make it easy to envision this technology used in the financial sector, but as we’ve talked about, Blockchain has many applications, from contracts and cutting fraud to arbitrage.
Blockchain is big. According to an IBM survey, “91 percent of banks are investing in blockchain solutions for deposit-taking by 2018 to protect against start-up non-banks.” While Blockchain has made inroads in finance, the program will soon play a role in most industries, from manufacturing and healthcare to retail and cybersecurity.
Taking advantage of blockchain
Blockchain is more than a trend, but some business owners might wonder how to get started. Blockchain comes with a learning curve, making initial install and set up a challenge. If you don’t have an IT or tech team ready to create or manage your blockchain, you can still take advantage with blockchain as a service.
- IBM recently unveiled blockchain as a service via its program IBM Hyperledger. This open-source blockchain is a service helping customers create, deploy and manage blockchain networks.
- Ardor is a new blockchain as a service in 2018, claiming it is “reducing blockchain bloat, providing multiple transactional tokens, and hosting ready-to-use interconnected blockchains called child chains.”
- Amazon partnered with Kaleido to offer “an all-in-one blockchain platform.” The platform integrates with other Amazon services.
- Oracle and Huawei are offering blockchain as a service built on IBM’s Hyperledger.
- Microsoft was one of the early ones to offer blockchain as a service with Azure.
- Several other companies are getting in on this as well.
Blockchain as a service offers many benefits, including:
- Accessibility to new technology.
- A way to test new technology without fully diving in.
- Customer support.
- Ease of use. Many of the service solutions offer packaged programs set up for different company sizes to use.
- Clean and correct application software and cryptography. An accidental coding mistake froze $300 million cryptocurrency dollars in 2017 — not something companies want to repeat with their own money or their clients’ money.
- Lower energy costs.
Blockchain isn’t always the answer
While blockchain as a service makes it more accessible, Blockchain isn’t necessarily the must-have solution for all. In 2008, low key/value stores were the hot trend, and many companies moved to them – only to later move back to SQL.
Companies can and should use blockchain to store employee time-tracking and smart contracts, and there are many other useful applications. If you need clear audit trail, blockchain is the perfect tool.
However, replacing an SQL database, for example, with blockchain may not be a good idea. Traditional databases are excellent if you require only basic transactions between parties. Public blockchain databases have experienced scaling issues and in some cases, are slower. Often you’ll pay a fee for each transaction in that database, making it more expensive in some cases. Check out these insightful flowcharts to guide you on whether you need blockchain.
Michael is a dynamic business professional with proven success in creative strategy, digital marketing and project management, in both the public and private sectors. He drives Imaginovation’s rapid business growth in marketing and sales owing to his multifaceted and versatile experience in numerous industry verticals. Michael holds an international Master’s degree in Business Communications Marketing from Bond University in Australia and a Bachelor’s degree in Public Relations and Marketing from UNC Pembroke.