Blockchain is essentially a database technology with attributes that, taken alone, are not unique to it but collectively produce a technological breakthrough in the way digital information is stored, verified, and exchanged.
When the technology hit the scene in 2009 with the release of its first application, the Bitcoin cryptocurrency, the blockchain had a Wild West feel akin to the early days of hackers, which made the technology risky and unproven for professional use. That changed five years ago when a burgeoning open source community started developing comprehensive enterprise platforms, including the programmable blockchain Ethereum.
Expectations for enterprise blockchain were sky-high at first, but the reality fell far short of the hype, and enterprise blockchain projects were few and far between.
Over the past two years, as household brands such as Bumble Bee Foods, IBM, Walmart, and Visa have proudly touted successful blockchain deployments, blockchain is getting a second chance at relevance in the enterprise. IT heavyweights, including Amazon Web Services (AWS), IBM, Oracle, and SAP, have primarily backed it. Is blockchain ready for business success?
"We're still in the early stages," said Martha Bennett, the principal analyst of Forrester Research. "I have examples of real processes running in operational environments, and there is no fallback option." She cited an example of an interbank reconciliation app in Italy.
But caution is in order. Using blockchain for business applications will not be easy. Its technical foundations and their practical implications are difficult to grasp. This is true even for tech-savvy business leaders with a working knowledge of, say, ERP or e-commerce. Blockchain is loaded with consensus algorithms, hashing, distributed ledgers, and bitcoin mining concepts. These arcane terms aren't just under-the-hood details that only technicians need to understand. They are the ones who determine whether blockchain is worth considering, what applications it is best suited for and the cheapest and most efficient ways to implement it.
The key is to have an accurate picture of what the blockchain does and doesn't do, the effects of its various deployment options, particularly its network architectures, and where the thick black lines are between blockchain and possibly better alternatives. This is the only way to take advantage of the blockchain and avoid wasting money on spectacular failures.
This overview is a good start. Click on the blockchain guide links for more details on blockchain technology and implementation.
How does blockchain work?
Most critical blockchain attributes come from distributed ledger technology (DLT). In recent decades, ledgers have been used for centuries to record financial transactions in digitized form in ERPs and other business software.
Unlike these centralized approaches, DLTs distribute copies of the ledger to nodes in a blockchain network, making each responsible for recording new transactions and participating in a consensus mechanism for agreeing on ledger updates.
Blockchain's unique data format is another differentiator that makes it a particular type of DLT. Traditional databases store data in rows, columns, and files, while blockchain stores it is interlinked, cryptographically protected blocks.
Why is blockchain important for businesses?
Investing in enterprise blockchain will likely become essential simply for competitive reasons. Just as companies paid close attention to breakthroughs such as the PC revolution of the 70s and 80s and the World Wide Web boom of the mid-90s, knowing that their competitors were taking advantage of these innovations, many experts believe that the blockchain will receive the same attention.
Indeed, FOMO – the fear of missing out – is probably the biggest motivation behind the new wave of interest in blockchain business applications.
But as you'll learn in the sections below, the herd mentality isn't the only thing driving blockchain. Technology today shows real potential for reducing IT costs, expanding B2B and B2C networks, enabling new products, and creating wealth. Additionally, the business value of blockchain is expected to increase as enterprise implementations proliferate and mature. You can do various blockchain business development jobs if you have the proper knowledge.
How can blockchain benefit businesses?
Enterprise blockchain comes into its own in processes that involve multiple parties, all of whom need access to the same data. Still, each has slightly different or outdated information, "and a huge amount of time is spent reconciling the data," says Bennett.
Because blockchain cuts out the middleman and mainly automates processes that often take time and effort, it can reduce businesses' IT and labour costs, speed up e-commerce and finance, and enable new areas of activity. It can also help companies expand their customer base, reach them more effectively, and broaden the universe of suppliers and partners.
The benefits of blockchain stem primarily from the trust it fosters, its built-in privacy, security, and data integrity and transparency. Trust makes it possible to do business with strangers, thereby expanding markets and potentially expanding demand for products and services, increasing profits.
Zentao is one such application that can help grow your business. It is entirely open-source and ideal for commercial use. Your entire project management cycle can be automated and will be right at your fingertips.
It is being able to trust data accuracy and believe that the system itself is essentially impenetrable. In most cases, confidentiality is assured can reduce fraud, eliminate data leakage and, like trust, attract more customers and partners. It can also reduce data management costs, improve data accuracy, and facilitate auditing.
Blockchain use cases in real-world industries
Blockchain use cases tend to cluster in deep-pocketed industries with tech-savvy market leaders who can justify and then implement blockchain business applications, which typically require coordination and substantial transactions between many partners, even competitors.
Here are examples of industries that are finding uses for blockchain:
Supply chain. Blockchain increases the number of suppliers and buyers and ensures the integrity of data moving through the supply chain, there by moving closer to the elusive goals of supply chain visibility and transparency.
Banking and finance. The use cases for blockchain in finance fall into two distinct segments: cryptocurrency and decentralized finance, or DeFi. Cryptocurrency is gaining credibility as an alternative payment mechanism in a global monetary system run mainly by government central banks and major payment providers, such as Mastercard and Visa. At the same time, DeFi is emerging as a potential replacement for other processes traditionally handled by banks and financial service providers, namely credit, insurance, banking, and investments. Using smart contracts, individuals could lend money to each other, pay interest, insure against loss, and trade asset derivatives. Some observers predict that these applications will lead to a "blockchain economy" in which cryptocurrency has largely replaced current monetary systems. People and machines manage business processes and exchange value without intermediaries.
Health care. The security, confidentiality, data integrity, and anonymity of blockchain could enable new uses of genomic data and individuals' medical records to support pharmaceutical research and facilitate the transmission of electronic medical records.
Government. Blockchain could facilitate – and legally – the electronic transmission of personal identification, online voting, the acquisition of a passport, and the preparation of legal documents and regulatory filings, such as mortgage deeds and financial reports.
Blockchain transparency has benefits in supply chain management, visibility, and traceability. Blockchain is already making it easier and more affordable to extend supply chain transparency to smaller suppliers, such as coffee growers, tuna fishing operations, and miners, while building trust in information on product provenance as goods move through the supply chain to consumers.
Need more help? Check out the Zentao blog. They have more articles on properly running a business, software management, building cross-functional teams, and so much more.
Author bio :
Erna is a technology enthusiast with expertise in software testing. She has been reading and writing extensively over current software testing trends. She also keeps a keen interest in futuristic technologies. She also writes for QA Infotech.