Most of us have heard of blockchain by now- the distributed ledger technology that allows users to add and view blocks of data and transaction records, but does not allow them to be deleted or changed. Those that are familiar with the technology, probably became aware of it as it is the technology that underpins Bitcoin and other cryptocurrencies. But it does have other uses as well- real estate transactions, digital identity management, financial transactions, and farm-to-table tracking for food products, it can be used for private business, within a company, or between individuals.
The most powerful feature of this technology is the fact that there is no centralised repository for the ever-increasing sequential chain of data records. As this repository is replicated in every participant’s blockchain node, there is no way that it can fail from a single source and there is no threat of breach of integrity. Not only does it allow users to conduct transactions securely without the need to engage an intermediary, but it also eliminates the often timely process of conducting offline reconciliations.
Whilst the chain itself is usually open to validation from any participant, some chains have the ability to ask for permissions that control the viewing of specific bits of data. This way it allows participants to only see the information they need to see, thus ensuring privacy for sensitive information. For example, a customer might be able to see that a contractor is in possession of a valid business license as well as viewing their address and any complaints lodged- but they could be restricted from seeing the name of the customers.
Blockchain technology is very well-suited to managing transactions between organisations and companies that may not know each other lacking mutual trust. The blockchain works in a P2P manner and allows an easy-to-track history that can serve as an audit trail as well as encouraging trust levels. Furthermore, smart contracts are perfect for automating processes that are often prone to human error or fraud.
There are many different industries that can benefit from the use of blockchain and these include banking, security, government, retail, healthcare, manufacturing, and logistics. It has the power to create immutable records on patients and clinical matters that can be shared instantly with permissioned parties. It could also be used to address the issue of counterfeit drugs which is a huge problem in the developing world.
A great example of blockchain technology implementation is Hyperledger- a blockchain-focused industry initiative which was created in 2016 by 30 companies including the Linux Foundation. By February 2018, 197 organisations were all involved in Hyprledger with implementations built on different cloud services or using different programming languages. One of the benefits of using Hyperledger is that the solutions that are built onto it can all talk to each other, as long as they are all Hyperledger compatible.
Whilst we are still in the early days and many challenges still lie ahead, applications such as Hyperledger are already making a big difference to real organisations. Businesses can raise cash by demonstrating they have verifiable outstanding invoices, goods can be verified and tracked, and even schools can easily publish diplomas and student records which significantly reduce the need for employers to verify academic records.
The blockchain is here and the possibilities are only limited by the imagination of each organisation that chooses to use it.
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