Nowadays, the technology is scaling towards new heights setting one records after the other. One is aware of the fact that the payment in bitcoin is based on the blockchain technology – a distributed database or public ledger where information stored is in digital form and cannot be manipulated.
One of biggest positives that the blockchain technology has given is giving birth to a decentralized economy by the creation of cryptocurrencies.
Therefore, it has been rightly regarded as future of financial institutions that will provide a new impetus to the e-banking and the cashless transactions. So no more paying additional charges because bitcoins are free from government controls.
According to a reliable research, the cost of Blockchain technology is expected to stay at around $10 billion and it will also have an impact on various sectors of the economy by the year 2022.
Moreover, it would also prove helpful in managing other tasks from e-governance to online education and maintaining the digitalized form of medical records. Blockchain will also prove handy when it comes to storing the database because here in this case it won’t be stored at one place.
Blockchain Catering a Wide Range of Industries
Blockchain technology apparently caters to extensive range of industries from online banking to e-payments, online governance to e-education, the healthcare sector, the real estate market, online shopping to insurance and traveling etc.
All these industries have been reaping benefits from the advanced blockchain technology.
A Brief Introduction to its Functioning
The functioning of the blockchain technology is not complicated but it has its own procedure of working. As such the e-data is mainly categorized into blocks that are serially linked with the cryptographic encryption and forms a difficult mathematical patterns via a chain.
Every block is linked with the earlier ones and has its own data. The new blocks can be added towards the end of the chain.
It must be remembered that after adding new blocks and updating the records you will not be able to make any further changes. It is nearly next to impossible for a person penetrating into the technology via illegal means.
Once the record is upgraded, it will be done on all systems at the same time. So, if hacking is done the concerned hacker will be unsuccessful as it will not follow his orders.
The Advantages of Blockchain Technology
So now that we are familiar with the working process of the blockchain technology, we can divert the attention to discuss some of its pros:
- Blockchain technology helps to save the cost of transaction which we have pay when doing internet banking.
- There are no chances of breakdown or loss of internet connection in case of blockchain. Therefore, is fully reliable and durable as it has decentralized networks.
- There is no risk associated with hacking and it is free from malicious attacks.
- The users have the actual control and power with respect transaction related information.
- The cost of transaction is free or very nominal
- There is no involvement of any third party and so that raises the bar of trustworthiness.
- The transparency factor is also maintained since anyone can see the change occurring in the public blockchain. The changes cannot be altered or erased.
- The transactions take place at a quick pace.
- All transactions are added into a single ledger, which avoids complexity.
How is Blockchain Useful for Finance Industry?
As we have emphasized on a few vital points that highlight the benefits of blockchain technology, we will perceive how it is beneficial for the finance industry:
Concept of Smart Contact
This is not a new term in the business world but was introduced way back in 1990. The contacts are basically self-implemented and the advantage that blockchain offers is making them safe and secured. Anyone can access these contacts around the world.
It also eliminates the obstacles generally associated with the middlemen as here you have to only pay a fee and that goes into the chain and you have to unlock the front door with the help of electronic key-code.
The blockchain has also eased out the process of supply chain, which otherwise was a complicated affair for most of the organizations. The technology helps in making everything transparent from when the goods are transported, who is handling it, the shipping costs, when it is expected to reach – all these information can be easily accessed in a single go.
Pay Easily in International Currency
Payment in foreign currency has always been a big challenge for most of the business organizations and if you taking the help of PayPal or Braintree, then the fees is high.
But thanks to the blockchain technology, much of this problem has been sorted out as the fee is very low and many companies including Etch pay their employees in bitcoins.
Benefit of Stock Trading
Stock Trading has been identified as one of the difficult tasks because it is time consuming as well as a risky affair. However, the blockchain technology has come to the rescue of the share traders offering automated and secured solutions.
Thus, even the much popular stock markets has got the blessings of this technology.
How has the Bitcoin and Cryptocurrency Influenced the Financial Sector?
We already are acquainted with the fact that the blockchain technology is the driving force behind bitcoin or the cryptocurrency and since its inception in 2009, it has emphatically and vastly influenced the financial sector and various economies.
As such a number of companies are conducting daily transactions using the cryptocurrency and the bitcoin wallet app, which they consider far simpler than going for the traditional payment methods.
Precisely, if they are using the bitcoin wallet app, they don’t even need the support of the third parties.
In addition, there is freedom from all sorts of control and regulation and there will be no effect even if there is inflation in the market. Quite similar to the blockchain technology, the bitcoin wallet apps are more secured because of the two-way authentication process.
The recurrent payment facility is time saving, which is big bonus for the finance and business industry.
Blockchain Technology – Boon for Other Industries
So far from the discussion it is evidently clear that blockchain technology is a huge bonus not only for the financial sector, but also for the other industries and businesses.
Thus, let’s peep in to see what other industries are extracting profit by availing the technology.
1. Blockchain Technology in Governance
Although bitcoins and cryptocurrency is free from government regulations, still the blockchain technology can prove to an enhancing performing asset for the government agencies.
It will help a great deal in establishing interaction between the concerned government bodies and the citizens. All other mandatory tasks such as paying taxes, getting passports, getting informed about policies will be much easier.
2. Blockchain Technology in Power and Energy Sector
As such the power and energy industry has not fully utilized the benefits of the blockchain technology, but it is slowly moving into that direction. It can increase the efficiency of power storage and also play a vital role in reducing the consumption of the energy.
Moreover, through peer-to-peer energy trading the excess generated power can be directly sold to the consumers. The technology will help to fulfill the demand of energy by various industries.
3. Blockchain Technology for Healthcare Industry
The blockchain technology basically will sort out the problems faced by the medical sector; specifically related to handling of the huge data and documents.
The doctors will be able to view the reports in real time and the data will be more secured through powerful encryption and digital signature.
Read also: How Blockchain Technology Is Changing the Healthcare Industry
4. Automobile Industry Excel Due to Blockchain Technology
For people who are into car rental business or the owner of a vehicle, the blockchain technology is just more than a need. It will help the registered users to confirm who the owner of the car is and even the ownership can be changed spontaneously without any hassle. One who is hiring a car will get a secure digital key.
5. The Good Days for Transportation Business
The blockchain technology has brought some good news for those associated with the transportation business. The technology will remove the hassles related to processing of the documents and payments.
Moreover, it will also make traffic operation smoother with the help of Internet of Things.
6. Blockchain Technology for Education
As far as the education sector is concerned, it is also adopting the new technology and many schools has already started to verify the student documents using blockchain technology.
7. Blockchain Technology in Real estate
Here the technology will usually assist in reviewing rental contracts and verify the received payments.
The blockchain technology has flourished with the bitcoin and cryptocurrency and they are going in hand to hand with one another.
The technology has revolutionized the entire financial industry and transformed the economy as a whole. Transactions have become so much easier as they were never before.
Not only has it been a big asset for finance sector, but for other major industries as well. Since it is still new, so many other sectors have not properly adopted it and are in the way.
So, if you ask that blockchain technology is the upcoming futuristic technology, then, the answer is big Yes!
If you are looking for consultation about Blockchain technologies and blockchain development, feel free to contact us.