Top FIVE Industries That Blockchain Will Disrupt
Blockchain in Finance, Supply Chains, Insurance, Real Estate & Land Registries, and Governance & Elections
In 2008, Satoshi Nakamoto (an alias for one person or a group of people) released the Bitcoin protocol spelling the future for fast and secure cross-border transactions without the need for financial intermediaries such as banks. Now, while bitcoin was lauded as a huge financial disruptor, the technology behind Bitcoin — Blockchain Technology — was the biggest asset unearthed by the protocol.
Today, Blockchain has grown from its inaugural application in cross-border transactions. Blockchain is now a fundamental asset in assuring trust, transparency, and security in transacting any sort of asset digitally without the need for expensive intermediaries.
If you don’t know what is Blockchain yet, take this free short course on Blockchain Basics to get a detailed understanding of Blockchain and Bitcoin. Alternatively, check out this blog for a detailed introduction: Understanding Blockchain Technology.
So, what industries stand to gain most from Blockchain’s benefits and advantages: Transparency, Immutability & Security, and Efficiency? Below are the top five industries that will definitely benefit from Blockchain disruption:
- Blockchain in Financial Services
- Blockchain in Supply Chain Management
- Blockchain in Insurance
- Blockchain in Land Registries and Real Estate
- Blockchain in Governance and Elections
Blockchain in Financial Services
Financial services have for long been reliant on the intermediation of banks and numerous other intermediaries for transactional trust and security. However, the cost of intermediation by these institutions has always been high and costly to a lot of consumers. Blockchain comes into the industry as an asset that will enable people to transact directly without the need for this costly intermediation. With Blockchains, consumers and businesses can directly send money to each other in a more secure yet transparent way. Some of the already known Blockchain protocols that are disrupting the financial services industries are Bitcoin, Litecoin (cross-border payments between consumers) and Ripple (Blockchain bank-to-bank transactions).
Blockchain in Supply Chain Management
Storing of transactional records and contracts between businesses has been a major issue for the supply chain management industry for years. A lot of transactions happen between businesses as a product moves from raw material producers to manufacturers, distributors before ending up in the hands of the consumer. Currently, these transactions are either stored in individual company silos or sometimes in shared ledgers that are not tamper-proof. Consequently, tracking goods from the source to the consumers becomes extremely difficult and the shared ledgers are not secure as any business entity can manipulate these ledgers to meet their personal interests.
However, with Blockchains, transactional records can be stored in a transparent shared ledger yet tamper-proof and secure. As a result, this will make it easier to trace products to the source in case there is a contaminated or counterfeit product. At the same time, it will increase trust in transactional records between companies in a supply chain.
A good example of Blockchain being applied in Supply Chain Management is the IBM-Maersk partnership tracking flowers from Naivasha, Kenya to Rotterdam, Holland
IBM and Maersk demo: Cross-border supply chain solution on blockchain
Blockchain in Insurance
Insurance is currently a multi-party ecosystem involving tons of interactions between consumers and insurance companies as well as insurance companies and other insurance companies or associated companies. All these transactional records need extreme security and speed for there to be the ultimate efficiency in conducting customer settlements and detecting any fraudulent activities. Blockchain, an immutable yet transparent ledger can be used to store transactional records securely in a multiparty ecosystem, therefore, making validation of records before making claims streamlined and less cumbersome. This shared ledger also makes detecting fraud easier and faster.
However, the biggest value of Blockchains comes with blockchain smart contracts. Through smart contracts, blockchains can allow for real-time or simply accelerated claim settlements and automatic validations/verification and underwriting that will resultantly make the claim processing processes in insurance more efficient and thus, faster.
Blockchain in Land Registries and Real Estate
Land and Real Estate are probably some of the most valuable assets people transact in the world today. Blockchain could, therefore, be a tool to transact these valuable assets.
Now, when it comes to land registries, governments across different countries manage the records, title deed allocation, and any land transactions. However, the centralization of these records makes it vulnerable to unethical land officials who can alter records and take bribe and alter records for their own personal interests. This land corruption is more prevalent in third world countries that lack record security systems and repercussions for corrupt officials. Blockchains can come in to improve transparency and security of land registries. Instead of an intermediary handling the records, Blockchains could create an extremely secure digital ecosystem for land transactions thus reducing the chances of any corruption practices by government officials.
In Real Estate, however, blockchains can be used to allow for fractionalization of assets by digitizing Real Estate developments. Currently, it is almost impossible to invest in Real Estate with a huge capital base. But, with Blockchain tokenization, with whatever amount, one can own a fraction of real estate development because digitization of real estate assets makes it easier to fractionalize ownership while still maintaining ownership records and security. One company is already championing this approach in New York:
Bloomberg News: Blockchain Takes Manhattan
Blockchain in Governance and Elections
When it comes to Governance, the centralization of trust to the government has been a major issue across many different countries. This applies mostly to developing countries with far less established structures to allow for equal and fair distribution of resources while preventing any embezzlement of government resources. Blockchains speak the perfect value for such systems, just in like in Supply Chain Management, the technology could be used to trace government spending from the source to the end project. The secure transparent ledger could promote trust in the governmental value chain. The biggest issue, unfortunately, is the willingness of governments with prevalent corruption to implement such a system. After all, it is still the same corrupt official that are in decision-making positions. But, let’s cross our fingers and see if there might be hope for Blockchains in government transparency and accountability.
Finally, election fraud is still a global issue with current systems still vulnerable to hacking and manipulation. Blockchain can assure higher security in election systems as the world gradually transits into digital elections. Fraud and result manipulation should not be an issue anymore if we resolve to Blockchain secure and transparent ledgers.
These are the top 5 industries that Blockchain could disrupt globally. However, this list is longer as the technology is still in innovation and new applications are being developed and experimented day-in-day-out. At the moment, there are tons of industrial applications spanning numerous industries.
Would you like to discover other applications of Blockchain and in-depth analysis of some of the industries we’ve discussed?
The Blockchain for Business course is just the perfect course for anyone, whether a developer or not (preferably anyone in the target industries) to learn how Blockchain is disrupting different industries.
Learn today with Chaptr Global!
Originally published at https://chaptrglobal.com.
