You would surely have heard the term ‘blockchain technology’ if you haven’t been living under a rock this past couples of years, after all, it’s the essence of the much-hyped cryptocurrency bitcoin.
The odds are that it wouldn’t have made any sense to you and as much as you would have tried to grasp from the common definition – “blockchain is a decentralised, digital ledger” – you wouldn’t have really understood what blockchain technology really is and why it is deemed to set in motion a chain of events that will transform the world for the better.
What is Block Chain Technology, and how does it work?
In the context of blockchain technology, block refers to digital information and chain refers to the public database.
Following are the types of digital information stored in blocks:
- The specific amount, time, and date of a particular transaction be it an online purchase from an e-commerce store or moving funds from bank A to bank B
- The information about parties involved in the transaction, i.e. the payer and the payee or the sender and the receiver. Note that the particular names of the individuals or entities involved are not recorded. Only the digital signatures or unique usernames are recorded.
- A unique code called a Hash that is used to differentiate one block from another
When new data or in other words information is stored in a block, it is added to the blockchain, which is primarily a number of blocks strung together.
For a block to be added to the blockchain, the following events must occur
- A transaction should take place
- The transaction should be properly verified by a network of computers, and each detail should be cross-checked to ensure authenticity
- The information pertaining to the transaction must be stored in the block
- A hash must be given to the block
- The block be added to the blockchain and become publicly available to everyone to see
In a nutshell, blockchain is an incorruptible and secure digital ledger that can be used to store any valuable information.
Let’s now take a look at the various industries that are currently looking to make the most of blockchain software development services to better incorporate blockchain technology and create additional value:
It goes without saying that the global food supply chains are anything but transparent in terms of the labour, inputs, commodities, and origin, to name a few. This is where blockchain can help bring in accountability and sustainability by forcing sellers and everyone involved in the process right from food production to delivery to end consumers to ensure the safety and quality of food products.
Walmart China has already announced plans to embrace blockchain technology to provide comprehensive information about the production of products, their source, geographic location, logistics process, and inspection reports.
As pointed out by the Wharton School at the University of Pennsylvania, the financial sector stands to gain a lot from the blockchain technology. This is because it can replace the traditional databases that are neither transparent nor completely traceable. Hence, they can be exploited, exposing the financial industry to corruption, money laundering, insider-trading and various other threats.
With the advent of blockchain technology, the financial industry can be transformed for good as costs can be lowered, and transactions speeds along with transparency can be substantially increased.
Be it diamonds, artworks, or real estate, the transparency and immutability that blockchain technology offers can surely benefit these industries.
Certification of authenticity, tracking history of the assets, avoiding corruption, ensuring ethical practices, avoiding conflict over claims of ownership are all possibilities if not certainties with blockchain technology.
All in all, blockchain technology is indeed a revolutionary technology that can help eradicate human errors, enhance accountability, and in turn, ensure that a select few cannot gain an unfair advantage over the rest.
That being said, there is a long road ahead for blockchain technology if it is to make a real difference. The best part is that it is continually growing with technological advancements, better usage of software, hardware, and UX services.