Blockchain Beyond Bitcoin: Applications Of Blockchain In Other Spheres

Much of Bitcoin’s BTC/USD characteristics and advantages over fiat currencies stem from its underlying system - the blockchain. Things like the anonymity of transactions, protection from tampering with data, and decentralization are all results of the blockchain architecture.

After blockchain technology proved so effective in keeping Bitcoin’s network running effectively, people started floating ideas about possible uses of blockchains in other spheres. The same set of features the blockchain architecture graced upon Bitcoin could potentially be lent to other sectors.

Blockchain proponents believe that the same way Bitcoin aims to revolutionize finance, the blockchain could revolutionize other services and segments of the economy and law. Here, we’ll take a look at possible use cases of the blockchain database structure beyond Bitcoin and what its application brings to the table in each case.

Blockchain And Ecommerce

The eCommerce sector saw sharp and continuous growth in the last decade and, unlike what happened with retail sales, it was only accelerated by the COVID-19 pandemic. While it proved paramount for the economic activity during lockdowns, many saw areas in which eCommerce processes could be improved.

• Private, safe, and quick transactions - one of the main hallmarks of the blockchain is how quickly transactions are processed on it. While traditional money wires can take days, transactions on the blockchain occur within minutes.
• Security - the use of cryptographic encryption on the blockchain can help protect from cybercriminals, whose attacks have massively intensified in recent years.
• Smart contracts - the use of smart contracts, which automate and document legally relevant events based on terms of a contract can build trust and eliminate the need for intermediaries and exchanging endless paperwork between the contracting parties.
• Inventory and supply chain control - with blockchain being a distributed ledger, all parties can easily keep track of inventory supplies and track the production and shipment of each product without the possibility of someone falsifying the data.

Blockchain And Finance

Similar to how blockchain technology can be applied to eCommerce processes, so too it can be used to improve business finance. In a sector traditionally burdened by endless paperwork, blockchain technology can provide easy and transparent process oversight for financial transaction management.

• Build trust - the transparency in operational costs, the time it took to finish a job, transactions conducted, and the alignment of cross-business databases can all be achieved via blockchain.
• Syncing of records - fiscal transactions, accounts payable, and the pay-on-delivery systems all stand to benefit from the transparency and speed provided by the use of smart contracts and the blockchain infrastructure in general.
• Verifying the legality of documents - thanks to the blockchain’s ability to store legal documents, its anti-tamper protections, as well as the possibilities given by smart contracts, businesses can quickly verify the legality of documents involved and streamline processes.
• Distribution of invoices - instead of waiting to receive invoices and settle taxes the traditional way, invoices can be instantly distributed across the network, without the fear of someone juicing the numbers up.

Blockchain And Data Privacy

The ever-increasing intensity and scope of data collection - both legitimately (and less so) by corporations and illegally by cybercriminals - has led many to believe that blockchains could be the solution to keeping our data safe. While there are some significant compliance issues between the blockchain and current data protection regulation, such as the EU’s General Data Protection Regulation, there are some evident benefits in using the blockchain architecture to protect data.

• Eliminates singular weak points - hackers usually go for the weakest link in cyberdefenses to break into a network. Due to cryptographic protection and the peer-to-peer nature of blockchains, this strategy of attack would be highly ineffective.
• Only authorized parties can view data - in the blockchain network, only those who are supposed to view the data can decrypt it. This prevents the leakage of sensitive personal data, both intentional and accidental.
• Transparency in data flows - with the blockchain being a transparent network, you can easily see where the data is going without revealing what information is being sent. This could provide users with a larger degree of control over who has access to their personal information.

Obstacles To Blockchain Application

While all these use cases seem extremely promising, there are significant obstacles on the way. The blockchain is often at odds with existing regulation, and either the regulation or the network (or possibly, both) would have to undergo significant changes for these integrations to run smoothly.

Additionally, the increased adoption of the blockchain architecture would have to involve the parallel adjustment of financial institutions and all parties involved to the new systems, which is a formidable task.

All in all, the battles on the political and regulatory level will prove to be as important as finding adequate technological solutions for the use of blockchain.