The list of blockchain applications and use cases in business and everyday life continues to grow.
Updated: Jun 22, 2022
As interest in Bitcoin and other cryptocurrencies has grown, attention has shifted to blockchain – the underlying distributed ledger technology (DLT) that powers these digital currencies.
At its core, blockchain technology is simple to grasp. Essentially, the technology exists as a shared database with entries that must be confirmed and encrypted by peer-to-peer networks.
Imagine it as a strongly encrypted and verified shared Google Document, where each entry in the sheet is dependent on a logical relationship to all its predecessors and is agreed upon by everyone on the network.
Use Cases in Banking & Finance
International Transfers of Funds
Blockchain enables the creation of a tamper-proof log of sensitive activities in a secure and efficient ways. It's ideal for international payments and money transfers because of this.
Markets for Capital
Capital markets could also benefit from blockchain-based platforms. According to a McKinsey analysis, blockchain systems provide capital markets a number of advantages, including:
Traditional trade financing techniques have been a major source of frustration for firms because the lengthy processes frequently disrupt operations and make liquidity difficult to manage. When communicating information – such as place of origin and product characteristics – cross-border trading entails a lot of variables, and transactions require a lot of paperwork.
Blockchain has the potential to streamline trade finance transactions and make the process easier to manage across borders. It makes it easier for businesses to transact with one another beyond regional or geographic boundaries.
Regulatory Compliance and Audit
Blockchain's incredibly secure nature makes it particularly beneficial for accounting and auditing because it considerably reduces the risk of human error while also ensuring the integrity of the records. Furthermore, no one, not even the account owners, can change the account records after they are locked in using blockchain technology. The trade-off is that blockchain technology might eventually replace auditors and eliminate jobs.
Smart contracts are arguably the most important blockchain use for insurance. Customers and insurers can manage claims in a clear and secure manner thanks to these contracts. All contracts and claims may be stored on the blockchain and authenticated by the network, which would reduce invalid claims by rejecting numerous claims for the same accident.
For example, openIDL, a network created in collaboration with the American Association of Insurance Services and implemented on the IBM Blockchain Platform, automates insurance regulatory reporting and streamlines compliance procedures.
Blockchain Applications in Business
Supply Chain Management
The immutability of blockchain's ledger makes it ideal for tasks like real-time tracking of commodities as they move and change hands across the supply chain. For companies carrying these commodities, using a blockchain opens up a number of possibilities. Entries on a blockchain can be used to queue up events in a supply chain, such as allocating products to different shipping containers once they arrive at a port. Blockchain offers a new and dynamic way of organizing and utilizing monitoring data.
General information such as age, gender, and potentially basic medical history data such as immunization history or vital signs are examples of healthcare data that is acceptable for blockchain. None of this data can be used to identify a specific patient on its own, which is why it can be maintained on a shared blockchain that can be viewed by a large number of people without causing privacy concerns.
Every five to seven years, the average homeowner sells their home, and the average person moves roughly 12 times throughout their lifetime. With so much activity, blockchain might be quite useful in the real estate industry. It would speed up home sales by immediately confirming financial information, decrease fraud via encryption, and provide transparency throughout the entire selling and purchase process.