Why Blockchain Technology? – 7 Important Factors that will convince you
Blockchain is one of the emerging technologies to make inroads into various sectors due to its numerous important factors. Here in this blog, we will know about what are those important factors which make Blockchain as one of the most promising technology.
Blockchain is a growing list of records, called blocks, that are linked using cryptography. Each block refers to the previous block and together make the Blockchain. Blockchain is not just a technology but also the next generation of the Internet that has varied applications in day to life. Also, with time the fostering of trust will increase and adoption of Blockchain will increase manifold, further, this will push up the demand for skilled Blockchain developers, which is again an exciting career option for young generations.
Blockchain with its decentralized and trust-less features can lead to open up new opportunities and benefits for many enterprises. You might remember that there were days when businesses had no fool-proof way to validate ownership of a digital asset or secure it, but that’s not the case at present as Blockchain has a pancreas for such problems. Verification of a transaction in a public network is not safe in the current time, so here Blockchain brings private and permissioned networks to suit enterprises. Now take an instance of a transfer of shares of ownership in the current scenario that requires much of paper works, a trusted entity to look over, or a legal advisor. Here Blockchain can play an important role by providing a trust-less secure environment which can be even over a public network.
Blockchain can even remove the need for a third-party arbitrator like legal advisors. The creation of digital assets too is now possible with the emergence of Blockchain, which was earlier not thought of. In fact, Blockchain is the first technology to allow you to transfer digital assets in a very secure and decentralized way.
7 Important factors of Blockchain
Blockchain has grown into one of the top emerging technologies in current time, but it might make you wonder that what led to its so much wide popularity? So, here I will mention those top 7 factors which led to the widespread popularity and adoption of Blockchain.
Security is one of the important key factors which Blockchain possesses, as to make transactions must be agreed upon before, they are recorded. A transaction after being approved is encrypted and linked to the previous transaction. Further, this information is stored across a network of computers instead of on a single server, which makes it very difficult for hackers to compromise the transaction data. In today’s scenario when there are lots of instances of data being stolen, and information is breached in this world of digital. Blockchain can plug in such loopholes by providing a high level of security which makes it impossible to breach for anyone because of the decentralized nature of Blockchain.
The very idea of Blockchain is based upon decentralization, as Blockchain is an increasing record of files, known as blocks, which are connected using cryptography. The Decentralized feature of Blockchain lets operation of system even if a part of the network fails, as database is distributed across the multiple locations in the network. Even if a participating party exits the network none of the data on the Blockchain will be lost. Decentralizations helps in creating a sense of security in the minds of users.
Blockchain is based upon transparency due to its operating mechanism of distributed ledger, where all network participants share the same documentation as opposed to individual copies. This shared version can only be updated through mutual consensus by all participating parties, which makes every record over it known and transparent.
Blockchain’s transparency feature can play an important role when adopted in supply chain solutions. Blockchain empowers the user to verify the product’s origin, materials, manufacturer, and much more, along with reducing counterfeit goods and supporting ethical trade, environmental protection, and human rights.
Blockchain enables each participant in the network to maintain a copy of an immutable ledger of transactions and allows transactions to be executed without the need of any third party or arbitrator. Any change in the record can only be recorded and updated through mutual consensus by all the participating parties in the network. This feature of immutability is very useful for applications in various sectors including banking, insurance, or even the retail sector.
Innovation is what drives the world of technology, so how can Blockchain be left behind in that scenario? Yes! Blockchain provides massive scope for innovation as its features are open and programmable, which anyone can tweak to suit their needs. Such flexibility opens up a new arena of possible innovations and never turns into redundant technology.
Blockchain technology when adopted and implemented on a long-term basis turns out to be the most reasonable financial model available right now in the world. Blockchain can even reduce cost in supply chains by ensuring more transparency, efficiency right from warehousing, tracking of goods delivery to all the way till payment processing. There are many enterprises that have already adopted Blockchain or working to adopt it very soon, as it has the potential to save lots of costs in their economic model, it is especially in the financial sector.
Blockchain technology is very flexible due to its high level of security and numerous applications in terms of usage. To execute a transaction, cryptography is used over the Blockchain network, which makes transactions happen in a flexible manner. Blockchain is a very inclusive and flexible technology, that when collaborated together with other technologies like AR, VR or IoT can have immense potential, that is capable of building robust futuristic solutions.
Adoption of Blockchain in major sectors
Blockchain in financial services normally comes in handy to Streamline the Banking and financial processes, as it can be applied to a lot of data processing purposes, payments and detect frauds. Blockchain virtually nullifies the need for arbitrators between two different parties.
Financial institutions are testing blockchain in a measured and conservative manner due to present rules and regulations. Moreover, it had been seen that financial institutions prefer blockchain consortiums for pursuing R&D.
Retail and Ecommerce
Blockchain is known and, Distributed Ledger Technology (DLT) therefore it empowers participants in the machine to each to maintain a replica of an existing ledger of transactions also allows trades to be executed without having any third party or arbitrator, consequently helps in smooth upkeep of files required for retail operations.
Blockchain technology has the potential to revamp and bring wide changes in the present medical sector, like allowing patients to assign access rules for their medical data to be seen to researchers for a specific time. Further Blockchain technology can connect to other hospitals and access their medical records in no time, thereby creating a sort of data bank, which would ultimately put into convenience for both the medical fraternities as well as patients. In short, it would be time and cost-saving for us.
Logistics and Supply Chain
When it comes to monitoring of distribution chains, Blockchain becomes the ace by removing paper avenues blockchains were doing a wonderful job to pinpoint different inefficiencies within the supply chains, also to find goods in real-time. Besides that, Blockchains for tracking of distribution chains enable companies along with consumers to find out the goods performed from a superb control standpoint at various time frames.
In the manufacturing sector Blockchain is being used by companies to track exchange data easily, accurately, and securely within complex supply chains. Warehouse Management System created and solves these things more accurately. Manufacturing industries across companies always face an imperative to protect IP. Here Blockchain comes here with the solution, where it helps to prove that a particular company owns IP in the event of a patent dispute.
Blockchain creates immutable documentation of quality checks and production process data, which helps customers track and trace inbound parts along a supply chain. Blockchain technology can help in enabling automated execution of and payment for scheduled maintenance, where a machine that requires maintenance can make a service request by generating a smart contract. Similarly, payment gets released automatically when the service request is fulfilled.
Cases of cyber-attacks are growing up with time, so comes to the forefront the task of safeguarding our valuable data. Here Blockchain has become one of the new technologies that can certainly augment the existing technology of cybersecurity, as Blockchain is originally a Distributed Ledger Technology (DLT), is focused on creating trust in an untrusting ecosystem. Moreover, it has been reported that US-based NASA too is looking at implementing Blockchain technology.
Blockchain offers a plethora of advantages apart from these 7 most important factors, which makes it a versatile technology that is growing and getting adopted by a number of enterprises.
With Blockchain getting collaborated with other emerging technologies, we can only see that Blockchain technology is not only going to stay on the top but continuously grow with time and can certainly a game-changer in many sectors to change the very face of many industries.