When blockchain technology was first introduced to the public, it was primarily associated with cryptocurrency. However, blockchain has far greater potential than just digital currencies. In fact, some of the world ‘s leading companies are already integrating blockchains into their daily operations, unleashing new efficiencies, capabilities, and business benefits.
Now, experts anticipate global spending on blockchain will reach $17.9 billion in 2024, with a five-year CAGR of 46.4%, Business Insider reports. In this article, we explore some of the most innovative business use cases for blockchain that go beyond cryptocurrency. We also make predictions about how blockchain will be used in future, unexpected business environments.
01The Origins of Blockchain in Business
To understand how blockchain will be used in business, it's important to first understand what blockchain is and how it works. Blockchain is a distributed database that allows for secure, transparent, and tamper-proof transactions. Blockchain received its “public debut” in 2008 in association with Bitcoin, a “purely peer-to-peer version of electronic cash,” as Forbes reports. However, blockchain can be used in a variety of industries and business applications besides cryptocurrencies alone.
Blockchain is the result of three technological innovations: the internet, cryptography, and computer science. Humankind needed all three technologies to advance significantly before blockchain could begin to emerge as an industry-transforming innovation. In fact, blockchain is often associated with the “fourth industrial revolution”—a collection of technological advancements that are disrupting traditional industries and creating new opportunities.
02Fundamental Features of Blockchain
Before we explore some of the innovative business use cases for blockchain, let's consider some of the key features that make blockchain so valuable.
First, blockchain is transparent and immutable. Transactions are recorded on a public ledger that is tamper-proof and cannot be changed. This provides scrupulous accountability and security for businesses and their customers. Blockchain therefore provides trust to companies and their customers by enhancing security and reducing the risk of fraud.
Second, blockchain is decentralized. There is no single authority that controls blockchain transactions. Instead, a blockchain network is distributed among many different computers around the world, making it resistant to common cyberattacks and outages that result from a single point of failure.
03Blockchain in Private Industries
Already, private corporations have adopted blockchain for successful use cases that have no association with cryptocurrency. For example, Walmart has transformed its food supply chain using blockchain. Walmart partnered with IBM to integrated blockchains (1) to trace the origins of mangos sold in their stores, and (2) to trace pork in their China retail locations, Hyperledger Foundation reports.
As Frank Yiannas, former Vice President of Food Safety at Walmart, describes: “I really had an ‘aha’ moment once I deeply understood the technology… Blockchain with its decentralized, shared ledger felt like it was made for the food system.
Blockchain has been adopted by several other large companies, including Microsoft, Dell, and JP Morgan Chase. These companies are using blockchain to improve efficiencies, create new capabilities, reduce costs, and even create new services for clients.
04The Top Five Business Use Cases for Blockchain
Now, there are several reasons why business leaders are integrating blockchain for business functions outside of cryptocurrency. Below are five of the most innovative business use cases for blockchain that go beyond cryptocurrency. These examples represent just a small fraction of the potential applications for blockchain technology today.
- Supply chain management. Blockchain enables companies to track products as they move throughout supply chains. Users can identify problems and inefficiencies in their operations, while also preventing counterfeit goods from entering the market. For example, pharmaceutical companies can ensure that drugs are transported under optimal conditions. As was the case with Walmart, grocery chains can ensure that food is safe and remains unspoiled as it moves through supply chains as well.
- Smart contracts. Supply chain partners can use blockchain to verify ownership of digital assets and to automate the contract-signing process. This allows businesses to streamline their operations and reduce the risk of fraud. For example, blockchain can be used by music publishers to track digital rights ownership and by banks to verify customer identities.
- Data security and privacy. Blockchain can help companies to securely store and share data with others. They can create tamper-proof systems that share data with multiple parties. This allows blockchain users to both collaborate on projects and protect the privacy of their data.
- Healthcare information sharing. Blockchain can be used to share patient data between healthcare providers—a critical function in modern, cross-institutional healthcare environments. Qualified users can safely access and share their medical records with other doctors, pharmacists, insurance companies, and emergency responders, among other practitioners.
- Identity management. Blockchain can help in the fight against identity fraud by integrating identity credentials. As an example, public sector companies can enable tamper-proof voting systems that verify the identity of voters and ensure that votes are not changed or modified during transit. Blockchain can be used for identity management as part of governance within individual companies as well.
These use cases represent unique and innovative solutions to common problems. But these examples represent just the beginning of the many ways that blockchain will be used in business environments.
05Blockchain Adoption and Integration
Private sector blockchain integration has challenges, largely related to governance and compliance. For example, businesses need to ensure that they have the proper systems in place to manage blockchain data. They also need to make sure that their blockchain implementations align with existing business processes and procedures.
Governance and compliance issues can be especially challenging for companies that plan to use blockchain in an open, permissionless manner. In these instances, blockchain users must make sure that they have the proper systems in place to ensure data integrity and security. Business leaders must ensure relevant personnel are prepared to use blockchain as well.
The integrations themselves are complex processes that require careful planning and implementation. Business leaders must determine what blockchain technology is best suited to their needs. They need to consider how blockchain will impact the overall ICT architecture and impact “decision supply chains” within critical lines of business. Also, business leaders may find that their blockchain implementations are not feasible or scalable without the right initial strategy.
These challenges underscore the importance of careful planning and implementation when integrating blockchain into business environments. By addressing these issues early, businesses can maximize the benefits of blockchain technology while minimizing potential problems.
06A Driving Force for Good
Data is ubiquitous and necessary; increasingly, data exchanges are the lifeblood to private and public sector organizations and their relationships with other entities. That’s why blockchain truly is part of a new industrial revolution—blockchain improves upon existing data functions in just about every way through fundamentally new organizational and technology structures. Ultimately, blockchain can become a powerful driver food good in both sectors.
07Partner with Semifly as You Begin Your Journey with Blockchain
The blockchain experts at Semifly can help you as you take your first steps into this exciting new digital space. Contact one of our experts directly to discuss blockchain opportunities with Semifly today.
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