We are going to discuss “Blockchain Technology”. A technology that will change the future of our economic and legal systems by keeping the records of contracts and transactions in a digital network. Before we discuss the potentials blockchain technology have, lets try to understand how this works in easy words. Once Albert Einstein said “if you can’t explain it simply, you don’t understand it well enough”.
As the name “Blockchain” clearly shows its a chain of blocks. These blocks store information of every transaction in a distributed manner. In other words blockchain is a digital ledger which stores information efficiently and securely with no central database.
This database is open to every party in blockchain network means every one has access to complete information but no single party is controlling the database. Once the transaction is finalized and accounts are updated, then information cannot be falsified. Because this transaction is connected with every previous transaction.
Now I hope you are able to understand how blockchain technology will restructure or redefine our today’s businesses, industries, economies and many other things. Below we discuss some popular use cases likely to exploit the immense potential of blockchain.
- Fast and Inexpensive Transaction Without Intermediary
Today if two parties wants to do a cross-border transaction, they need a third party. Simply if person A in United States wants to transfer money to person B in Australia. They need a trusted money transfer agency to do a job for them. Typically person A order the agency to transfer money. The agency charge a fee for a transaction and takes few days until the beneficiary receives the money.
The blockchain does the same job but this time no intermediary is involved. Secondly the transaction is faster than before, in fact immediately. And finally it is cheaper as compared to previous method. Although there are some hurdles to be passed, like regulations of different cryptocurrencies and countries of the world. But nevertheless, this is one of the most discussed blockchain application.
This blockchain application is capable of solving many complications the banking and finance system currently facing. These institutions need an intermediary to handle their daily activities. This increases the cost of different services they are offering to clients. But using blockchain these services are available at reduced price.
- Smart Contract
This is another future application of blockchain technology. Smart contract is nothing more than our physical contract. But it is virtual and represented by a computer programming code stored inside the blockchain. This contract manage all the terms and conditions of a contract. After that it automatically verifies fulfillment and then executes the agreed terms. Smart contract ethereum is an example of it.
- Personal Identity Information
In this era of digital world, the individuals or organizations are maintaining their online presence. But they are also facing constant threats of stealing their information or money. Thanks to blockchain identity management system, these threats have become a past now. The personal identification process creates layers of security where data is linked to your biometric verification or digital signatures.