How E-commerce can Benefit from Blockchain
In a world where the global cryptocurrency society continues to grow more and more with each passing day, it is hardly possible to find anyone who didn’t hear the term Blockchain.
An innovative and unique idea that shows us what we can achieve thanks to technological advances.
But what is a Blockchain, and how is it working?
The easiest way to describe it is a decentralized ledger that records and stores data on a computer network. What separates it from other databases is the specific method by which it operates. The recorded information is stored on a growing list of records, called blocks, which are linked by cryptography.
Modification of the data is almost impossible since it is necessary to reach a network consensus and edit all related blocks. The system is managed by peer actors, which protects it from much of the problems that usually affect other databases.
Distorting information and hacking the system would require an almost impossible amount of computing power, making Blockchain one of the most trusted and secure networks on the Internet.
Blockchain was created in 2008 by Satoshi Nakamoto, the person or group who is also responsible for the creation of Bitcoin. The system was implemented as part of the cryptocurrency and function and was to record all transactions performed. Since then, the network has become something incredible and revolutionary and promotes cryptocurrencies and creating many platforms. According to the note, the file size of the Bitcoin blockchain reached a phenomenal 100 gigabytes in 2018.
What makes blockchain technology so popular with the public is the elimination of the need for intermediaries, which leads to fast, secure, cheap, and open services. Using encrypted technology eliminates all security risks that come with using the Internet. Individuals can make international transactions for one hundred times, completely free of charge, enjoying an advanced security system that keeps all their digital assets safe.
Ethereum is probably the most ambitious Blockchain project to date.
The platform is open-source and comes with its computer language that developers can use to create their programs. But what makes Ethereum so unique is the creation of so-called “smart contracts.” Smart contacts are transforming into computer code that is stored and monitored by a computer network. The system is efficient, reliable, affordable, and can be used in many situations and sectors, from financial to governmental.
Online shopping and social commerce are two industries that can reap the many benefits of implementing Blockchain technology. The online trading market has reached over $2.3 trillion in 2018 and looks set to continue to grow. Commercial businesses are always looking for ways to grow and grow, and it’s clear that by leveraging the potential of Blockchain technology, the way we shop will change forever.
Service openness is one thing Blockchain is most known for.
Numerous technology-based platforms seek to repair consumer-to-retailer relationships and build a trust-based relationship. When online shopping is powered by Blockchain, people can track the entire history of a product, making sure that what they buy is of high quality and comes from the right place. Thanks to the existence of smart contracts, customers will never again have to worry about buying damaged or counterfeit goods.
The biggest challenge in incorporating cryptocurrencies and Blockchain technologies into any industry is some unresolved financial and legal issues. However, many online platforms have taken on the responsibility to solve these problems and have created successful business models.
For example, the inability to use fiat money is a massive part of the reason the public has not yet adopted this revolutionary technology. Platforms that have made the exchange of fiat money and cryptocurrencies easy and affordable have been able to attract many customers. Also, developers often encourage people to use their platform and be active, rewarding them with tokens, coupons, or other rewards and discounts. The goal is to create an ecosystem sustainable with an easy-to-use interface and an open connection between customers and traders.
The best option for integrating cryptocurrencies in e-commerce is Smart-Contract. It is a contract between two parties through which you can exchange anything you think of — products, services, movable and immovable property, money, etc.
With Smart-Contract, the intermediary between the two parties is completely excluded, but this does not make it less secure. These types of contracts are written in a particular programming language — Solidity and describe all actions, rights, obligations, and penalties for breach of contract by both parties. Once the Smart-Contact is ready, they are uploading online, which guarantees full transparency of the contractual relationship.
Although these kinds of contracts, written in a programming language, may sound like something new.
They’ve been created back in 1994 by Nick Zabo, a lawyer and cryptographer.
It also concludes that decentralization can be fully implemented in contractual relations. Not only is the process simplified, but the contracts themselves can be converted to computer code and stored on a Blockchain network. That’s how they get the other popular name — Blockchain contracts.
As an example of Smart-Contract, we can give any football bet.
Each participant may bet a certain amount on a football match of his choice. After the football match is over, the Blockchain contract receives the outcome information and calculates the winner of the participants. He then pays him the money collected from the other bidders.
Here, there is no central place where you can get your money. No one may refuse to pay the profit or change the terms of the contract generated.
To be used in an online store, Smart-Contacts are generated after clicking on “I agree to the terms of service” when confirming an order. Which means it’s a good idea to read the Terms, no matter how long they may be.
