How Blockchain Will Influence Business
Blockchain technology is here to stay — hardly anybody would doubt that. Yet public opinion currently most closely associates blockchain with cryptocurrencies and ICOs, so the potential of various technological benefits both for people and business is distorted. We have already spoken about the benefits of blockchain for the people, so let’s switch to the opportunities that blockchain brings for businesses.
No matter what size your company is, blockchain solutions will provide you with capabilities for easing (and even eliminating) most of the annoying routine procedures, enhancing your overall business model and increasing profits. As it was already said in the article “How to Invest in an ICO”, blockchain does not perform miracles or provide you with cheat codes to hack the realities of doing business. It is a system with a set of tools that make investing and doing business more efficient. The question is who uses these tools, and how.
To start, let’s draw a distinction between three ways in which blockchain solutions are being implemented in business now. The first implies that conventional companies — predominantly large ones — are redesigning their current structures, gradually implementing blockchain instruments. For example, FedEx is testing a new blockchain tracking system. Another example is Walmart and IBM launching a blockchain Food Safety Alliance for the Chinese market.
In both cases, there’s a centralized entity — FedEx and Walmart — but the services it provides are far more secure, transparent and faster than today’s traditional solutions since the two utilize blockchain technology. (The best comparison from the blockchain world itself is the Waves decentralized exchange, within which tokens are traded trustlessly, whilst the process is underpinned by a centralized matcher.) Blockchain instruments, used by large companies, run on smart contract mechanisms and decentralized data distribution, meaning any action is executed at the right time and any entity is totally traceable, providing businesses with a significant reduction in operational costs and real-time data updates.
Another set of applications involves the creation of completely decentralized services from the ground up. In this case, you can choose between FedEx, that uses blockchain in its services, or a DApp (decentralized application), that lets literally anyone be a delivery agent, just as anyone can be a cab driver with Uber. The key difference between a DApp and a traditional App is a higher level of security and transparency. A DApp is based on the use of smart contracts, which cannot be tampered with. Transactions within smart contracts are immediately executed when all the conditions of the deal are met. Also, services can be evaluated by voting on the blockchain — a fraud-proof and open voting mechanism.
Finally, there will be conservative businesses that simply use out-of-the-box blockchain instruments without implementing them in their core structures.
To sum up, in the future we will see the emergence of the following types of businesses:
- Conventional businesses that use ready-made blockchain solutions without incorporating them directly into company’s structure/model: they will use existing DApps/blockchain businesses as contractors and providers of services.
- Centralized businesses, with an existing structure, that utilize in-house/co-developed blockchain instruments: while remaining centralized in structure, they will alter their business and management schemes by implementing blockchain solutions, exclusively designed for the company’s needs.
- Fully decentralized business platforms within which anyone can become a service provider.
The fact that large corporations are adopting blockchain is nothing special. What’s more important is that being low-cost, secure and easily accessible, blockchain solutions are already offering high-quality new perspectives for small and medium business development. If you realize the importance of adapting to new business realities, you should definitely hop on the train of the blockchain revolution. Read more about the areas of business that are being influenced by blockchain here: “The Future of DApps”.