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What's the Big Deal About Blockchain, Anyway?

Business.com / Technology Solutions / Last Modified: March 5, 2018
Alexander Yakimov/Shutterstock

Blockchain promises a more transparent, secure way of conducting business. Here's why you need to pay attention to this rapidly evolving technology.

With bitcoin and cryptocurrencies becoming more mainstream, some experts are predicting that blockchain will have an equal or greater impact than the birth of the internet. The technology is decentralized, meaning unlike fiat currency, there is no governing body controlling it and no chance of corruption. It uses a public ledger to record all transactions, creating transparency for its users.

For many, the appeal of the blockchain is due to its open, unchangeable nature and distributed ledger. While currently a platform to host digital currencies, many see it as a marketplace for the future, where products, services and assets can be exchanged without the traditional structures.

Let’s dive into the benefits of this technology and why it’s such a big deal.

Transparency Across Multiple Industries

The blockchain works due to the countless users who are seeing the same transactions in the network. If someone attempts to alter a data set, other users can quickly resolve the issue and ensure that transaction is not fulfilled.

One of the main reasons why this new tech is so interesting to businesses is that it’s almost always open source, meaning other users can modify the algorithms as they see fit. Additionally, it provides a solid foundation of absolute transactional truth that a whole universe of open source projects could benefit from. While this seems a bit unnecessary to some, it makes sense for business owners who are worried about their data being altered or changed. Blockchain not only reinforces transparency, but it offers a safe and secure way to conduct business.

A Decentralized Universe

The blockchain makes it easier for each and every individual transaction to have their own proof of validity and authorization. This makes it harder for hackers or cybercriminals to compromise or utilize the data set, due to the massive number of individual servers the technology operates on.

Smart Contracts

The worst time suck of all? The contracts, especially for large enterprises that process a cluster of communications on a daily basis. But with the introduction of blockchain and smart contracts, agreements can be performed automatically, including being validated, signed and enforced. Not only is this a big-time boost for employees, it can also save the company money.

While a decentralized network makes it easier to organize your cluster, it is important to note that one must still incentivize other entities to run the smart contract and store the data.

Peer-to-Peer (P2P) Transactions

With the rise of bitcoin and cryptocurrencies, retailers and brands are struggling with whether to include this as a form of accepted payment. While they ponder, users are able to transfer their funds globally, without paying transaction fees or worrying about the safety of their money.

Cryptocurrency allows for a more secure transaction and allows users the freedom to control their movement of funds. Additionally, there’s no worry about converting the fiat currency from the origin’s method to the new country’s method.

The prospects for blockchain technology across multiple industries are endless. The hype is only going to increase as we see more startups and enterprises embrace this new form of tech, similar to the internet boom. Companies like Dell and JPMorgan have already integrated the tech into their current business offerings, while Facebook announced plans to explore its potential.

It’s important to understand blockchain technology now, to get ahead of the game.

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