Last 2009, the launch of Bitcoin moved blockchain from theoretical use to real-world, indicating that it was working. Since then, businesses have also tested how blockchain technology works for them.
Blockchain is a decentralized digital ledger system that records every transaction without a financial intermediary such as a bank. Big companies, government agencies, and charity organizations are being used to enhance existing processes and allow new business models.
The benefit of blockchain comes from its ability to share data across organizations in a fast and secure manner – without requiring anyone entity to take responsibility for protecting the data or enabling the transactions.
Blockchain and its features can provide numerous benefits to businesses, whether they use a public blockchain network or private or permission blockchain-based apps.
Now, what are the benefits of blockchain technology? Let’s start with the top 10 blockchain benefits.
One of the most well-known advantages of blockchain is its ability to provide transparency. This feature may seem to conflict with blockchain’s promise for privacy and security, but both of these benefits can function in tandem.
On a public blockchain, all transactions are searchable and traceable. Users can search a complete ledger of wallets that contain Dragons to see how they are being used.
The level of transparency may provide customers with complete information of the production and distribution cycles of purchases made at their local grocery store or from major online retailers such as Amazon.
Blockchain builds trust amongst entities when trust is either lacking or unproven. As a result, these organizations can participate in business dealings, including transactions and data sharing that they would not have done otherwise or would have needed the assistance of an intermediary to do.
One of the most often mentioned benefits of blockchain is the improvement of trust. Its value is apparent in early blockchain use cases that enabled transactions between businesses that did not have direct relationships but need to share data or payments. Bitcoin and cryptocurrencies, in general, are iconic examples of how blockchain allows trust between people who do not know one other.
Another significant benefit of blockchain-enabled technologies is their computer system security. The enhanced protection provided by blockchain comes from how the technology works: blockchain provides an unchangeable record of transactions with end-to-end encryption, which prevents fraud and illegal activity.
Moreover, data on the blockchain is stored throughout the computer network, making it very difficult to hack data on servers, unlike conventional computer systems. Furthermore, blockchain can handle privacy issues better than conventional computer systems by encrypting data and requiring permission to limit access.
The blockchain nature can also help businesses to save money. It improves transactional efficiency. It also minimizes manual activities like data aggregation and editing, as well as reporting and auditing. Experts emphasized the benefits that financial institutions experience when using blockchain, stating that blockchain’s capacity to expedite clearing and settlement immediately translates into process cost savings.
In general, blockchain helps businesses save money by removing the middlemen – suppliers and third-party providers – who have traditionally supplied the processing that blockchain can perform.
Blockchain can handle transactions quicker than traditional methods since it eliminates intermediaries and eliminates remaining manual transactions. In some cases, blockchain can process a transaction in minutes or less.
However, times may vary; how quickly blockchain-based transactions can process depends on various factors, such as the size of each data block and network traffic. Nevertheless, experts have concluded that blockchain generally beats other rapid procedures and technologies.
One of the main reasons Bitcoin’s popularity is growing is due to decentralization. In this case of Bitcoin, miners from all around the globe keep an eye on and protect the Bitcoin blockchain’s integrity. By performing cryptographic computations, they validate transactions on the Bitcoin network.
Since Bitcoin is decentralized, it is difficult for outside organizations such as governments to manipulate or inflate it. This decentralization provides:
An attacker would need to possess 51% of the Bitcoin network’s global hash power to compromise it, which is costly and not sustainable over time.
With the blockchain ledger, an audit trail is present to track where the products originated each time exchange of goods is recorded on a Blockchain. It can assist not only enhance security and fraud prevention in exchange-related companies and help verify the validity of exchanged assets. The supply chain is more transparent than ever before, thanks to blockchain. It can use in medicine to trace the supply chain from manufacturer to distributor or in the crafts to give irrefutable proof of ownership. Organizations can also benefit from blockchain traceability by adopting it in-house.
Point-to-point encryption helps in the security of data while it is in transit and storage. Transaction blockchains are a safe method to store transaction data and transaction ordering. A strong P2P distribution of identical copies of the blockchain over a cloud computing network provides a third layer of security. Distributed data storage is better than a single-point data storage design, which has a greater chance of data breach. Data files are broken down into encrypted pieces, stored on multiple nodes, perhaps throughout different countries.
When blockchain technology is used, a record of transactions is widely disseminated. A blockchain is so helpful because it is made public or distributed to many authorized users. The failure of a single network node does not affect the original stock of the blockchain.
While any node is offline, the other nodes continue to work and update the blockchain. Any network node that experiences a failure can quickly catch up to the current blockchain database state when the node comes back online based on the transactional record of the blockchain entries, particularly if they have a secure timestamp.
Hyperledger is a blockchain technology created as open-source apps as part of a collaborative initiative funded by The Linux Foundation. Multiple copies of an identical blockchain record make illegal data processing exponentially more difficult. The use of peer-to-peer networks to decentralize record-keeping provides a complete audit trail. Unlike bitcoin, there is no need or desire for privacy among hyper ledger users. These records can share in the cloud through cloud computing, and different parties can store identical copies for audit verification. The benefit is that the national government knows and controls who all the authorized users are; nevertheless, it is the users, not the central power, who keep the hyper-ledger with their efforts.
Finally, this brings us to the end of our discussion of the main advantages of blockchain technology. Now that you understand the significance of blockchain technology, you can form an opinion about using it.
Blockchain is a game-changing technology that will have a significant effect on every sector. Our focus was limited to the essential sectors so that you could relate to and understand their benefits. But, in the end, the decision is entirely yours. Hopefully, this article will help you in making the best choice to boost your business.
Jennysis Lajom is an IT graduate, a chemist, an eCommerce business owner, and a Korean drama fan. Her passion for digital marketing led her to a career in graphic design, editing, and social media marketing. She is also one of the resident SEO writers in the Softvire US and Softvire Australia