When most people think of blockchain, the first thing that comes to mind is cryptocurrency such as Bitcoin. However, blockchain is a technology that has been around for much longer than people realize, and its potential applications are far vaster than simply a new means of banking.
Blockchain has the potential to revolutionize any industry that involves transactions between two people—that is, every industry. Blockchain ensures transparency, security, and accuracy between two people, allowing them to perform transactions directly without the use of a middle man. In the right innovative hands, this means that blockchain can reduce corruption, decentralize markets, and eliminate third parties who collect a percentage of payments or that exist solely as another level of bureaucracy.
Here are just a few ways that a forward-thinking entrepreneur can leverage blockchain to disrupt the future economy for the better.
Land Titles and Legal Processes
Many developing countries are rife with corruption inside their legal processes. According to a TED Talk given by Don Tapscott, executive chairman of the Blockchain Research Institute, blockchain can be used to transparently produce, verify, and record legal documentation to eliminate fraud and corruption.
For example, a longstanding problem in Honduras is the lack of official documentation for landowners. Without legal titles, legitimate landowners can have their property taken away by the government. With blockchain, titles can be produced for these landowners and safeguarded from destruction or unauthorized alteration. This can be done for any type of legal document, thus enforcing transparency as championed by Domineum.io—a critical component in the development of democratic societies and governments.
Direct Transactions Without a Middleman
Industries are rife with middlemen and third-party services that charge a fee simply for facilitating transactions. PayPal, Airbnb, Western Union, and multitudes of other platforms are relied upon to provide safe and secure interactions between two parties. In today’s economy, these platforms are necessary because they provide a level of security and record keeping for the transactions they enable. Sure, you could try to directly rent out a spare room to a stranger or mail money to someone in a foreign country without using a third-party provider, but you are taking a significant risk by doing so.
With blockchain, however, peer to peer transactions have a level of transparency, security, and record-keeping that eliminate the need for these third-party brokers. Imagine the cost savings when one can safely wire money to an employee, friend, or loved one without incurring fees, or the boosted bottom dollar for a freelancer who can offer their service directly to a consumer without paying commission to a middleman. Even the global stock exchange can be revolutionized through blockchain, as stock brokers will no longer be needed to facilitate transactions and investors can work directly with the companies they want to support.
Transparent Supply-Chain Tracking
In today’s globalized economy, supply chains can be incredibly long and complicated for the simplest of products, even at a time when consumers are demanding more and more transparency in where their commodities are being sourced from.
A blockchain ledger can be used to track the materials of a product as they move through the supply chain from the source to the buyer, painting a clear and transparent picture of who all is involved with the making of the product. Consumers can finally have full awareness on whether or not their items are sustainably sourced and if the producers were paid fair wages for the materials they provided. All the necessary information can be recorded on an unalterable blockchain ledger for review.
This can greatly improve the trust level between the consumer and the company. Blockchain ledgers for rare jewels can prove whether or not the gems came from conflict-free zones. Artwork ledgers can be reviewed to see if a piece is authentic or if it was stolen or fenced. Claims made by “fair trade” or “sustainable" labels on food products such as coffee can be backed up and verified with a blockchain ledger. Sourcing can prevent food fraud that is all too common for many high-end luxury foods such as caviar, wine, and fish.
Own and Sell Your Data Your Way
Many economists say that, in the 21st century, data is the new oil. The problem, however, is that the original owners of the data—you and I—currently have little to no control over who we give our personal data to and where it goes once it has been given out.
Personal information needed to log into a website immediately gives companies information they can sell for a profit. However, if blockchain were to be used to authenticate login credentials, individual users could maintain integrity over their personal data, choosing to sell their information as they see fit for their own profit, as opposed to the profit of a data aggregator. In other words, blockchain can monetize data to the advantage of the consumer as they sell their personal information directly to the companies of their choice, thus promoting data security for all.
Every type of human interaction needs security, transparency, and accurate record-keeping in order for societies to prosper. Blockchain technology provides these necessities to anyone willing to use it. With the right innovative mind, blockchain can truly transform the way our economy functions and disrupt every market. As an entrepreneur, what ideas or insights to do you have for applying this technology to your industry? Let us know in the comments below.