Blockchain’s Wider Impact

Blockchain technology has become synonymous with Bitcoin in recent years, but it actually has far broader applications beyond cryptocurrency. While Bitcoin introduced blockchain as a way to record financial transactions without a central authority, blockchains can be used to track, verify and secure all kinds of digital information. Let’s explore some of the key ways blockchain is being utilized beyond Bitcoin.

Verifying Product Origins and Authenticity

One of the most promising uses of blockchain is in supply chain management. By creating a digital ledger that tracks materials and products from origin to sale, blockchains can help verify authenticity and prevent fraud. For example, luxury brands are implementing blockchain to prevent counterfeit goods by assigning unique digital identifiers to each product. Consumers can then scan a tag to confirm if an item is genuine.

Blockchain can also trace the origins of food products, allowing shoppers to see exactly where their meat, produce or spices came from. This provides transparency around issues like ethical sourcing, organic certification and fair trade practices. Companies like Walmart already require produce suppliers to use blockchain ledgers to track farm origins.

Enhancing Cybersecurity

Blockchains are inherently secure due to their encrypted, decentralized structure. This makes them well-suited to improving cybersecurity and preventing hacking in sectors like financial services and healthcare. Private blockchains can be used internally by organizations to protect sensitive digital records and assets.

Identity management is another cybersecurity application. Blockchains can store digital IDs that are encrypted and only accessible by the owner. This helps prevent fraud and protects personal data. Platforms like uPort and Civic are developing blockchain-based identity services.

Streamlining Administrative Services

Government and public agencies can utilize blockchain’s transparency and automation features to reduce bureaucracy and costs. Dubai has committed to putting all government documents on blockchain by 2020. The Swedish land registry is trialing a blockchain property transactions system to speed up contracts and transfers.

Other administrative use cases include electronic voting, which helps secure ballots and prevent tampering. Blockchain is also a promising solution for storing medical records, allowing patients to share their data securely with new care providers.

Decentralizing Social Media

Centralized social media platforms like Facebook and Twitter have faced controversies around censoring content, selling user data and enabling the spread of misinformation. Blockchain advocates believe decentralized, peer-to-peer social networks could be the solution.

On blockchain social platforms, no single entity controls the network. Users retain ownership of their content and data. Posts and interactions are permanently recorded on the blockchain, limiting censorship and encouraging accountability.

Examples include Steemit, a blockchain-based blogging site, and Mastodon, an open source, federated social network. These early models suggest blockchains may enable fairer, more democratic social media.

Facilitating Digital Payments

In addition to Bitcoin, many other cryptocurrencies are built on blockchain to facilitate fast, borderless digital payments and financial transactions. Cryptos like Ripple aim to disrupt existing payment systems by cutting out middlemen like banks and credit card networks.

Smart contracts – self-executing code stored on a blockchain – are another fintech innovation. These contracts digitally oversee and enforce the negotiation or performance of a deal. The blockchain verifies fulfilment before releasing payment. Smart contracts are being used for applications like insurance claims processing.

Supporting the Sharing Economy

Blockchain also underpins the sharing economy, allowing providers to build peer-to-peer marketplaces without a central company controlling transactions. These could disrupt established industries like taxis.

For example, blockchain network La`Zooz aims to build a fully decentralized alternative to Uber, owned by its community of drivers. Participants earn tokens for providing rides, which can then be used to pay for rides. Similar models are being explored for sharing bikes, scooters, accommodation, office space and more.

Final Thoughts

While blockchain first emerged from Bitcoin, its applications now extend far beyond cryptocurrency. Blockchain’s inherent security, transparency and automation make it a versatile solution for streamlining processes, preventing fraud, decentralizing networks and facilitating digital trust. As the technology matures, we’re likely to see further innovative applications across many different sectors and industries. The long-term impacts could potentially be as profound as the arrival of the internet.

References

Tapscott, D., & Tapscott, A. (2016). _Blockchain revolution: how the technology behind bitcoin is changing money, business, and the world_. Portfolio/Penguin.

Christidis, K., & Devetsikiotis, M. (2016). Blockchains and smart contracts for the internet of things. _Ieee Access_, _4_, 2292-2303.

Iansiti, M., & Lakhani, K. R. (2017). The truth about blockchain. _Harvard Business Review_, _95_(1), 118-127.