Blockchain and industries: A Complete Guide

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Cryptal global

14 min readJan 2, 2023

What is Blockchain?

Two terms, block and chain, make up the term blockchain. When discussing a chain and a block in the context of blockchain, a chain of digital data is referred to in which each block contains this data. Indeed, a general definition of blockchain is that it is a chain of records known as blocks that are distributed, decentralized, and shared. Each block in this chain is in charge of keeping some sort of data (such as transaction records).

Each block includes transaction-related data, including the date, time, amount of your online purchase, and the identities of the buyers and sellers involved in the transaction. Your purchase is performed using a particular digital signature without revealing your identification information, as opposed to using your real name in transactions.

Why is blockchain necessary?

Stuart Haber and W. Scott Stornetta first coined the concept of blockchain in 1991 as a cryptographically secure chain of blocks. Over time, it has expanded its place among databases worldwide. Digital business owners thought about using this technology to improve their business operations, and eventually, the need to use it was spread worldwide. However, there are three main reasons for the need for blockchain;

Increased digital processing power

Due to its designed structure, blockchain requires more processing power than normal data computations. Blockchain design is cryptographically defined and encrypting and decrypting data is inherently expensive. Today, computers have more processing capabilities as modern microprocessors are developed, increasing demand for this technology.

The rapid growth of cybercrime

Cybercrime has increased in recent years. Stealing over a billion Yahoo accounts, leaking user information on Facebook, and growing damage caused by malware are just a few of these crimes. In fact, more than a million cybersecurity threats are published every day, which in itself draws more attention to security. Cybersecurity is one of the biggest challenges facing internet business owners today. Blockchain partially fills this need by using its robust encryption system.

The rise of digital currencies like Bitcoin

One of the main causes of Blockchain’s increasing popularity is Bitcoin and other digital currencies. A mysterious individual by the name of Satoshi Nakamoto developed the digital money known as Bitcoin and distributed it securely using blockchain technology.

How does the blockchain function?

A chain lock is made up of a number of linked blocks. Four events need to take place before a block may be added to the blockchain:

1. Start a trade or deal

A new block is added to the blockchain for every trade or transaction made on the network. For instance, if you wanted to add some Ethereum to your friend’s wallet, you would accomplish this by adding a new block to the Ethereum network.

2. Verify the transaction

The network miners are in charge of validating your transaction after filing your transfer request. New data must first be entered into the system. Computers do this. Thousands of machines scattered throughout the globe frequently make up this network.

3. The transaction is saved

You must put your transaction in a block of storage. Your intended deposit amount and digital signature are saved in a block after determining the transaction’s legitimacy.

4. Hashing is used to add blocks to the blockchain

A block must be given a special identifying code called a hash once all of its transactions have been verified. The block can be added to the blockchain after hashing.

Everyone will have access to a new block after it has been added to the network. Take a look at the Bitcoin blockchain, for instance, and you can see that you have access to transaction data and can view the following details:

· Block height. This is the most block that has been added to the blockchain chain, according to the block height (Height) calculation, which is based on the total number of blocks.

· Block Hash. A hash block (Hash) is a 64-digit code string that starts with zero and consists of both integers and characters.

Blockchain in Industry

As mentioned, blockchain is an emerging technology that has gone viral in cyberspace. Nevertheless, many people do not fully understand it.

Those who do not work in blockchain, or prefer to stay on their professional path, probably will not understand the intricacies of this technology. However, a basic understanding of blockchain technology and how it affects the business world will help business owners prepare for a brighter future.

Essentially, the blockchain network consists of a distributed ledger, like a Google Doc, that can be accessed by people authorized to connect. The many computers known as the network nodes that make up the chain must verify any changes made to the ledger. Therefore, while the blockchain ledger is accessible from almost anywhere in the world, it also provides good security.

Given the advantages that blockchain technology offers, the application of this technology in industries should be studied, and how it can help in the business world to simplify and increase security will be analyzed.

Applications of blockchain in Fintech

Today, blockchain in FinTech or financial technology has shined brightly and transformed customer access to financial services. Fintech companies use digital technology to manufacture products and provide services such as online banking, money management, branchless banking, artificial intelligence, and e-wallets.

Blockchain removes third parties from high-level transactions. In other words, financial transactions with this technology do not require any bank or government support, which means no fees.

Blockchain fits a number of common use cases in the financial services market, including regulatory compliance, cross-border payments and settlements, asset tracking and trade taxation, and settlements. Since blockchain input is instantly visible, this technology has the potential to reduce settlement and clearing times. This process can take up to five days.

The report claims blockchain technology can reduce infrastructure costs by an average of 30% for eight of the world’s top 10 investment banks, generating annual savings of $8–12 billion for banks. This has prompted many to invest in blockchain.

In the case of escrow payments, the processing is often complex and involves multiple communication layers between the payment participants to confirm the transaction. Payments and settlements in the financial services industry, including stock exchanges, are very inefficient because, in this process, each institution maintains its own data; others are contacted by email to find out where they are in the process.

Common processing problems slow down the process; Incoming payments outnumber outgoing payments, forcing the exchange to use batch processing. Therefore, the settlement usually takes two days. This delay in closing accounts forces banks to set aside money they can invest.

Since data can be shared instantly with blockchain users, this technology reduces or eliminates the need for transaction modification, verification, and analysis. This makes the resolution process more efficient and effective.

JP Morgan, the founder of this network, pointed out that its creation was to reduce the number of intermediaries in the process to speed up payments.

MasterCard also launched its Blockchain network in late 2017 to enable partner banks and merchants to make payments faster and more securely. MasterCard’s blockchain service can be used to clear credit card transactions and eliminate paperwork using smart contract rules and speed up transaction settlement.

The benefits of using Fintech are faster completion speed, fewer errors, reduced labor, more financial transparency, and reduced backend costs.

Applications of blockchain in mobile payments

Before the launch of a blockchain-based cryptocurrency exchange, the company’s infrastructure limited peer-to-peer currency provider KlickEx. The service serves about one million users per day in 8 countries or about 80% of homes in the Pacific region. Today, 90–95% of currency transactions under $200 are done through electronic payments.

When not heavily taxed, the old KlickEx trading system was capable of paying fees between 90 and 200 seconds. The blockchain-based payment system that KlickEx has created cross-border payment processes in seconds.

The Polynesian payment system provider has collaborated with IBM to create an open-source payment network as a new international exchange based on blockchain. Using IBM’s blockchain software platform, the new network will enable the exchange of cryptocurrencies of 12 different currencies in the Pacific islands, Australia, New Zealand, and the United Kingdom. The new blockchain-based real-time system means payments are made instantly.

Applications of blockchain in medicine

Blockchain can act as a network of cooperation (interoperability) and allow different parties to exchange and add new information instantly, such as patients’ electronic health records.

Blockchain acts as a verification tool to ensure that only authorized users, such as doctors, insurance companies, or patients, make changes. Blockchain interoperability can underpin data exchange and serve as an alternative to current health information exchanges (HIEs).

It acts as a network to deliver real-time patient information to healthcare providers, pharmacies, insurance companies, and clinical researchers. With this technology, patient records are stored with high security and made available to medical centers, etc.

In 2017, the startup MintHealth launched mobile personal health records based on a blockchain exchange. This startup prepares the necessary foundations for commercial health insurance plans. These programs are used to help patients with chronic conditions such as heart failure, diabetes, and high blood pressure. Today, these patients account for more than 90% of medical costs. In addition, at-risk patients will also benefit from accessing medical records and taking control of their health data by entering data such as vital signs or blood sugar levels. The US Food and Drug Administration uses blockchain to securely exchange patient information, including sensitive electronic medical records, clinical trials, and more.

Amazon already provides an analytics service that looks for unstructured data that doctors can use to treat patients better. Amazon’s new service features a Natural Language Processing engine that can read medical prescriptions, radiographs, and more. This service uses machine-learning algorithms. In early 2019, SAP launched a blockchain-based supply chain tracking service. This service allows drug wholesalers to authenticate drug packs returned from hospitals and pharmacies. The center plans to expand the use of this technology to include a wide range of drug supply chain processes.

The use of blockchain in the aviation industry

The use of blockchain in the aviation industry has been in the spotlight since 2016 and is growing day by day. The technology has important applications in aviation, including ticketing, passenger identification, travel management, and passenger loyalty.

Today, many documents used in the aviation industry are blurred and prepared in the traditional way. This leads to accidents and delays, thus, additional costs. Blockchain has supported this industry and made the process of creating information transparent to avoid problems that may arise due to a lack of transparency. Some of the benefits of blockchain in this industry include things like simplicity and ease, cost reduction, and data transferability.

Application of Blockchain in Internet of Things (IoT)

Arthur Carvahlo is a blockchain expert at the University of Miami Business School. He said that the three fundamental characteristics of blockchain technology are distributability, immutability, and decentralization as a data structure that can benefit the Internet of Things (IoT) (source).

Using surveillance cameras as IoT devices, Carvalho demonstrated how IoT could take advantage of blockchain technology.

Suppose a thief plans a complex action to achieve his desired goal. First, thieves can attack and break into the server where the video database is stored to prevent surveillance cameras from recording the theft.

Blockchain’s extensibility means that data is stored across multiple computers. This fact makes hacking more difficult and challenging because, with such a strategy, the thief has to attack multiple target devices.

Arthur Carvahlo, the blockchain expert at the University of Miami Business School, said: “The excess storage space created by blockchain technology increases security and also increases the accessibility of data and users in the ecosystem. IoT states can access their data. Send to different devices and retrieve them. Continuing this example, suppose the thief is caught and declares in court that the recorded video is fake evidence. The immutable nature of blockchain technology means that any changes to stored data are easily detectable. As a result, the thief’s claims can be easily confirmed or disproved by examining the attempts and actions taken to manipulate the data, Carvalho said.

Additionally, according to Carvahlo, the decentralized aspect of blockchain technology regarding data storage can be a significant problem for IoT devices.

In centralized storage, it is possible that the computers used to store data belonging to certain government organizations and they have tampered with sensitive user data.

Application of blockchain in supply chain management

A supply chain is an organizational and logistical system through which goods move from the factory, extraction facility, or producer to the consumer. These are often complex systems that can cover the entire world. Since importing and exporting raw materials and finished products has become a global business, closely monitoring the supply chain is a very tedious job.

Most of these systems consist of independent databases that store their records centrally. This makes it virtually impossible for those in charge of supply chain management to obtain the necessary information about shipments and processes. Because fragmented, fuzzy, and opaque data can disrupt the unit of information that should exist throughout the supply chain. This is where blockchain technology can have huge benefits.

As mentioned, blockchain is a single, decentralized ledger, which means anyone in the supply chain can save their information to this ledger after obtaining the appropriate permissions.

This unique and secure system allows anyone in the chain, especially supervisors, to see in real-time how goods are handled along the route to their final destination. This increases transparency and makes it easier to identify the cause of supply chain disruptions resulting in lost, damaged, or counterfeit goods. This is especially useful in pharmaceutical and food supply chains, where counterfeit products and contaminated food can disrupt the entire supply. The ability to precisely track the point in the supply chain where contaminated products have entered can save money and lives.

Blockchain in the construction industry

Blockchain can revolutionize the construction industry in four areas, which are:

1. BMS

The intelligence and availability of construction project information on a smart platform is undoubtedly one of the essential needs of the construction industry in the coming years. According to research from the University of the West of England, intelligence can significantly reduce intermediaries, time, and costs. Control and optimization. Blockchain is one of the methods that make this possible.

2. BIM

In the process of building information modeling or BIM, the people working on the project strive to make the real and real model of the project have the same high quality and accuracy as the model designed according to the following principles, details, and rules stated on the BIM Platform. Blockchain technology can effectively enhance member coordination and project issues in the construction industry and make the use of BIM in the construction industry more efficient and optimal than before.

3. Financial sector

Blockchain and its efficient nature were originally proposed for the financial exchange sector, and many people may have become familiar with the blockchain technology surrounding digital currencies. Blockchain technology helps to optimize the payment field.

Timely payment and management of financial resources are always one of the top challenges and concerns for businesses. Failure to make payments on time and poor cost management has many negative impacts on the progress of projects. Tracking and tracking transaction information is our help. One of the technologies in this platform is BuilderChain, which is specially designed for financial transactions and can be used for secure payments.

4. Supply chain management

Delays are ultimately inevitable in a project, leading to adverse consequences such as incurring additional costs, reducing productivity, and creating many problems for the project contractor. However, blockchain comes to the rescue for the problems raised this time. Managing, tracking, and tracing resources from source to destination solves many of the problems and inconsistencies that can arise in the supply chain. In addition, blockchain can make it easier and faster for investors and project managers to hire and contract contractors by preparing a platform to use and track digital identities (Digital-Specific Identification).

Other blockchain applications in different industries

· Cadastral

Blockchain increases the efficiency of recording any information, and at the same time, the recorded information is completely transparent and visible to everyone. Since real estate is one of the high potential fraud and the real estate registration process is very expensive, this technology can be used to improve its performance. To date, several countries, including Russia, Honduras (2015), and Georgia (2017), have adopted blockchain for real estate registration.

· Investigation

A survey system can be set up with blockchain. But the most important and main difference between blockchain surveys and regular surveys is “data validity” because in a blockchain, there is no possibility to modify and manipulate data; for example, if 70 % of people say option one is better than two, no. one could say that 70% to 69 percent. This defies the possibility of fraud in conventional investigative systems! Authentication and fraud prevention in blockchain-based electronic elections are also worth considering.

· Food industry

The problem of food fraud has spread throughout the whole food business. Although there is not a single, agreed-upon definition for what constitutes food fraud, it can be stated that any action taken to manipulate food, put fraudulent marketing on labels, or add dangerous dietary additives to make money is included.

Blockchain helps improve transparency in the food supply chain. When the food is shipped, its data is added to the blockchain. This process is repeated for modifying or adding new ingredients to that food, and so when the final product lands on store shelves, all points in the supply chain related to it are updated and perfected. The data will be made available to both regulators and consumers, providing a high level of transparency.

· Education

Educational institutions, universities, and schools can use blockchain to store data related to assessment tests, registration and provision of educational certificates, verification of student transfers, and science and technology exchange.

· Accountant

In fact, the very essence of blockchain is inspired by accounting, and one of the best uses of blockchain is in this area. Transactions are recorded through the blockchain, eliminating human error and protecting information from possible manipulation. All records must be verified each time before being transferred from one blockchain node to another. In addition to accuracy, make sure your records are traceable, like a high-level audit trail.

Of course, the entire basic accounting process also becomes much more efficient. Instead of keeping separate records, businesses can only have a common record of an entity. The integrity of the company’s financial information will also be guaranteed.

· Power distribution network

Similarly, today’s energy production networks are managed by centers that control and manage energy distribution. However, the significant development of renewable energy, such as solar power or development of batteries, is leading to the emergence of small local distribution networks. Therefore, if you produce energy at home or at your workplace, you can store it in a battery and use it when needed. You can even sell it to your neighbors.

Such an event can lead to energy savings and energy waste avoidance. Because the longer the energy travels, the more it will be wasted and the more expensive it will be. With this method, there is no middleman; everyone can buy and sell independently. Currently, energy production companies are the trusted link between users and their (energy) needs. Because they control the infrastructure, they also take their share.

· Journalism

Tapscott says that blockchain could also change journalism. For example, for each story, short story, or article read, the reader must pay one-tenth of a cent (one-hundredth of a dollar). As a result, the reader decides what content is important and important and pays for it. In Tapscott’s view, this could be a way to deal with fake news in the real and valuable news environment created by journalists. Of course, from a more professional point of view, perhaps such an action would benefit more famous writers, and the less popular but important news of today’s world would be viewed less often.

Conclusion

In brief, Blockchain is the distributed ledger technology that powers cryptocurrencies like Bitcoin and offers a transparent and reliable way to store and transport data. Blockchain technology may be used to make many organizations and entities transparent, democratic, decentralized, efficient, and safe. In the next five to ten years, blockchain will completely transform a variety of businesses.

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