What is a Blockchain?
Blockchain Technology became famous with the rise of cryptocurrency. But it is no longer limited to crypto and NFTs, it has invaded many important industries that have real-world impact. From banking, cross border transactions to health and public administration, blockchain is revolutionising every sector.
Blockchain is a decentralized network of data storing blocks that stores data in encrypted form making it secure as well as traceable. The recent data shows that this technology has been growing across different sectors and according to a study by Statista, its global market size was somewhere around USD 11.78 billion in the year 2021. And it is expected to expand at a compound annual growth rate (CAGR) of 42.5% from 2022 to 2030.
How Does the Blockchain Work?
Blockchain Technology works in a very simple yet brilliant way. It records and distributes the data across a network of connected computers. One thing that is best about blockchain is it is not centralized and it works in a decentralized manner.
- Firstly it authenticates the transactions to the input. Now this transaction is stored as a block in a very similar way as a ledger entry.
- This block is sent to each and every computer node in the network in an encrypted form for storage.
- These authorized nodes then validate the transaction and add the data to the blockchain.
- Now this update is distributed across the network as a final step.
Features of Blockchain
Blockchain technology is shaking the world with its ultimate features. And these features are helping various sectors from health to banking. Some of the key features that make it a stand-out technology are listed below:
- Decentralization
Most of the technologies are centralized and the decision-making power is concentrated in the hands of a few. This leads to biased outcomes at times. However, when it comes to blockchain technology, the power is distributed across the various network nodes. This ensures trust building, and security and improves transparency.
- Immutable Verification
Now the worst part of manual or generic technology that stored data was that it could be altered. However, with Blockchain technologies, once the data gets recorded in the block it is impossible to alter or get corrupt.
- Smart Contracts
Another good part is that the self-executing protocols are coded into the blockchain and it automates transaction verification. Thus eliminating any need for manual verification for every transaction.
- Updated Storage Units
You must have seen piles of files with settled dust in government offices. These files are seldom updated and they are very difficult to search for the information that is required. However, in this technology, the data containing blocks are stored on nodes and these nodes keep updating with every new entry.
Uses of Blockchain Technology
There are not one but multiple uses and benefits of Blockchain Technology. In various sectors, it is used to secure data, financial transactions, store information, etc. Here are some benefits of Blockchain Technology in various industries:-
Banking and Finance Industry
In the banking or finance industry, blockchain technology provides a secure and tamper-proof network for sensitive transactions. As finance is a privileged sector, blockchain provides automated banking facilities, a secure network, and data history, and enables customers to make payments internationally. It also reduces the intermediaries that are typically required in these transactions while reducing the cost of transactions.
The Blockchain systems also have the strength to improve the capital markets. Reports suggested by McKinsey have claimed that blockchains help in Faster settlements, Consolidated audit trails, and enhanced operations.
Public Administration
Public administration had a patent vibe of piles of files on old selves and settled dust and spider webs on them. But with evolving technology, this also started changing and some countries started incorporating advanced technology such as blockchain in their work to offer better experience and improve efficiency.
For instance, Estonia has started using blockchain in tax, productivity and health industries. Whereas the baltic country in public administration to fuel interoperability and decentralization. This has allowed these countries to share confidential data in an authorized and encrypted form.
Copyright and Patents
Blockchain technology has significant potential in the realm of intellectual property, copyrights, and patents. However, it faces certain challenges, particularly with legal frameworks and jurisdictional complexities on a large scale.
Despite these obstacles, blockchain offers numerous benefits, such as reducing costs associated with processes. It ensures authentication of rights registration and management, facilitates the control and monitoring of rights distribution, and provides evidence of effective or initial commercial use. Additionally, it supports electronic rights management and exclusive distribution through smart contracts.
Healthcare Sector
Blockchain technology’s robust security features ensure privacy, making it invaluable for protecting the confidentiality of patients’ medical records.
Beyond this, blockchain offers other advantages in healthcare. It enhances the traceability of medicines, enabling laboratories, pharmacies, healthcare providers, and authorities to reliably track the journey of medications. For certain drugs requiring strict temperature control, blockchain helps verify if the cold chain has been properly maintained.
Moreover, this technology reduces fraud, errors, and counterfeiting in clinical research and drug verification processes.
Food Sector
The food industry can also benefit greatly from blockchain technology, thanks to its ability to enhance management, security, and transparency.
Blockchain allows consumers to trace the origin of their food, improving transparency and boosting trust in food safety. It optimizes the supply chain, improving production, distribution, and logistics while reducing costs and delivery times.
A prime example is its application in the olive oil industry. Blockchain ensures full traceability and certifies the authenticity of olive oil, guaranteeing compliance with certifications and giving customers confidence in the product they purchase.
Conclusion
Being a reliable, decentralized, traceable, transparent, and efficient innovation, Blockchain Technology is revolutionizing multiple sectors. From health to public administration it has made the process faster and helped them to keep the sensitive data secure across the network.
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