Most people have heard of Bitcoin, but not everyone understands how this, and other cryptocurrencies work, or the technology behind this virtual (digital) money platform. The component that allows cryptocurrencies to exist is Blockchain Technology. Blockchain is also the technology that provides security for every cryptocurrency transaction.
How and why is Blockchain secure, and what other uses are there for the technology?
More importantly, how will Blockchain technology effect your future business?
In the case of cryptocurrencies, they are stored in a holder’s digital wallet, which is given a unique randomly generated password that consists of a long string of numbers that may look like this: “34fe9f09e27cc9057e03d29e5ebde996be2869ac1a412e9188f023165df39e74”.
Each crypto wallet and the currency within are tracked through a series of connected computers called a node, each with a matching ledger system referred to as distributed ledger technology. Hundreds of node computers are located around the world with matching ledgers.
Every cryptocoin transaction is recorded in a block on the ledger sheet that identifies the product sold and the crypto-coins used. Every subsequent transaction generates a new block which is verified against the previous block in what becomes a Blockchain. Because of these individual node computers, each with their matching ledgers, it becomes impossible for someone to hack into the system to steal information.
These ledgers keep track of every cryptocurrency transaction that has ever taken place and processes the information through “Distributive Consensus,” whereby each node on the network mathematically verifies that the transaction is accurate and has not been modified.
While the distributed ledger technology and blockchain verification system is the backbone of the cryptocurrency world, it is also finding its way into other industries. In fact, Blockchain and distributed ledger technology (DLT) technology have become part of boardroom discussions in just about every field, and it is likely to be a key driver of Industry 4.0. Globally, the enterprise blockchain market is expected to grow from around $2.5 billion in 2016 to $19.9 billion by 2025
In May of 2019, Deloitte published its Global Blockchain Survey: Blockchain gets down to business (registration required).
A survey of 1,386 senior executives in a dozen countries—at companies with between $100- and $500-million, or more, in annual revenue resulted in:
- More than half of executives (53%) say that Blockchain is a critical priority for their organization, up 10% from last year. Furthermore, 40% of enterprises will be investing more than $5 million in Blockchain over the next five years.
- Financial services and financial technology (fintech) sectors are leading in blockchain development.
- Enterprises are looking for and finding valuable use cases for Blockchain completely independent of bitcoin and cryptocurrency. This includes managing loyalty points, digitizing physical assets, creating virtual contracts, and wallets for finance management and reconciliation.
- Enterprise leaders (83%) say there are now compelling use cases for the technology, 86% believe it will achieve mainstream adoption even though 43% see it as overhyped.
How will it be used?
In the same way that randomly generated passwords protect digital wallets, a team of scholars at Plymouth University, Plymouth England, has outlined a method of secure Digital Voting using Blockchain Technology, a current issue in the 2020 U.S. election and elections around the world.
Blockchain’s core properties like immutability, security, and real-time tracking make it well-suited for specific processes like supply chain management and product origin certification. This is perhaps the most impactful effect that Blockchain will have upon the retail industry.
Healthcare providers are looking at a blockchain-enabled health information exchange that would alleviate security concerns related to data-sharing between different providers. A patient would be able to access and share their data from the Blockchain, and each provider would be able to update relevant information with an individual key.
In the world of finance, a financial technology company called Populous uses blockchain technology and digital tokens as a secure, transparent, and modern solution for businesses to get immediate funding for international financial transactions, including bank loans and invoices factoring.
In the real estate sector, Propy, a global property store and decentralized title registry, uses Blockchain to become a safe and secure global solution for tracking the ownership and sale of international real estate properties. On Sept. 24, 2017, the purchase of an apartment in Kyiv by TechCrunch founder Michael Arrington using Propy made history—it is the first real estate purchase with cryptocurrency, and the first real estate transfer on the Blockchain.
Propy uses the nearly impenetrable Ethereum blockchain to record the proof of ownership and is the most secure real estate system to adopt worldwide to standardize the industry. Blockchain simplifies a complicated buying process that ordinarily takes months, into a simple online transaction—opening the international market to American investors and allowing hundreds of billions of foreign dollars to flow into the American residential sector.
The transparency of transactions recorded via Blockchain is a significant enabler of faster payments and improved financing across international borders. It reduces risks such as currency exchange fluctuations and fraud and lowers cost. Populous created a Blockchain-based Smart contract platform to autonomously perform all necessary functions connected with funding, releasing payments, and distributing recorded data. This technology eliminates manual error and the need for any services from third parties. Of course, local onsite verifications are still necessary.
At INNOVA Technologies, our engineers and designers are working to secure your future with innovative and sustainable structural solutions that will stand the test of time. For more information, contact us on the web or call 702-220-6640.