BLOCKCHAIN (PART 02): WHAT IS IT AND WHY DO WE NEED TO KNOW ALL ABOUT IT?

This portion of the blockchain discusses the uses and applications of blockchain technology, as well as the risks associated with this technology.

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BLOCKCHAIN USES AND APPLICATIONS:

The blockchain has many applications aside from being used in cryptocurrencies.

• It is used in money transfers:

When making cross-border payments, blockchain technology allows for secure money transfers between banks and the maintenance of secure ledgers. The blockchain technology includes a bidirectional and settlement component. Before any funds are transferred, this component verifies the transaction. If the payment fails for whatever reason, no money is transferred to the receiver's account, and both parties are notified instantly.

• Protection against money laundering:

Any transaction that is carried out utilising blockchain technology will leave a series of records that cannot be changed. It also makes it simple for authorities to track where the money is coming from and to whom it is flowing.

Money laundering risk assessments and reporting procedures are made easier using blockchain. It permits total system analysis in addition to tracking money transfers.

Fraud activities are immediately recognized when Smart Contracts are connected with the Blockchain-based AML platform. The built-in algorithms assist in keeping a constant eye on each and every transaction, automatically identifying questionable transactions and blocking them.

• For insurance purposes:

Customers and insurance providers can benefit from smart contracts because they provide better transparency. The records of insurance claims will be kept in strict security, which avoids filing of duplicate claims for the same event. Smart contracts also aid in the speeding up of claim processing.

• For supply chain management:

Blockchain is often used in retail to track the supply chain. This technology will inform merchants of when each event in the supply chain occurred, as well as who owns it, where it occurred, and any other relevant information about the shipment.

• In Real Estate:

Real estate may leverage blockchain technology to record various real estate transactions, making ownership verification and transfer more safe and accessible. This will help to speed up transactions, save money, and reduce the amount of paperwork required.

• In voting process:

Voting with blockchain technology ensures that no one votes twice, that only eligible voters are allowed to vote, and that votes cannot be altered. Voters can cast their votes without revealing their political preferences to the general public. This technology allows officials to count votes with complete confidence, knowing that each ID corresponds to one vote and that no duplicates or false votes will be counted.

• For cybersecurity:

In cybersecurity, blockchain can be used in a multitude of ways. When it comes to software downloads, blockchain may be used to authenticate updates and downloads, preventing fraudulent malware from infecting devices. Because hashes are recorded in each block, this would aid in verifying the downloads' integrity.

• In oil and gas industry:

In the oil and gas business, there are numerous stakeholders and partners. Because each member in the supply chain duplicates a single contract, most commercial transactions are ineffective. Blockchain technology makes it simple to transfer data and keeps account of each transaction.

Some complex operations, such as accounting, are automated, lowering operating costs. Furthermore, smart contracts can be utilized to eliminate market barriers by removing intermediaries and allowing processes to be carried out effortlessly. Furthermore, each node or user of the blockchain network holds the same information, suggesting that after a transaction is completed, it is nearly impossible to change the transaction's history. To simplify data storage and maintenance in the oil and gas business, a single repository of all information is maintained.

 • In travel and transportations:

The travel industry focuses on multiple companies to transfer information back and forth. Customers' personal information are transmitted between companies and tracked, and travel agencies must provide client information to flying companies or motels. This blockchain technology makes it easier and more dependable to access and store information. Financial transactions are an important component of the travel business, and blockchain technology helps to simplify payment operations while maintaining high security.

 

Similarly, blockchain technology can be used for a variety of purposes by media companies, the manufacturing sector, retail management, healthcare industries, as well as by the government.

COMPANIES THAT USE BLOCKCHAIN:

Microsoft, Samsung, Walmart, Amazon, Visa, HSBC, Unilever, Ford, FDA, Accenture, DHL, Shell, People's Bank of China, Singapore Airlines, and many others are among the companies that use blockchain technology.

RISKS OF BLOCKCHAIN:

The blockchain protocols are tough to interpret since blockchain is a novel technology. Additionally, cryptocurrency prices are volatile. At times cryptocurrency values can be extremely high, far exceeding investors' expectations, and they can also be extremely low, leaving investors with nothing. Moreover, for conducting proof of work huge amount of energy is used.

If a public blockchain is used, there is a possibility that malicious actors will work together to sway blockchain transactions or information. When a group of miners control more than 50% of the network's hash rate, the transactions are validated in the chain, and there is a risk of fraudulent transactions.

Further, there is a chance that a participant may spend a bitcoin twice and acquire items worth two bitcoins before the provider even realizes that the money has already been spent.

Additionally, proof of stake is more prone to "forks," in which stakeholders with a majority share can make their own decisions about transactions, resulting in the creation of a new currency.

FUTURE AHEAD:

Blockchain will be the foundation technology for 30% of the global customer base by 2030. The Ministry of Electronics and Information Technology (MeitY) has selected 44 priority areas, ranging from pharmaceuticals and agriculture to education and energy.

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Traditional cross-border payment systems may be replaced by blockchain technology, which has the potential to be faster and less expensive. Significant barriers must be overcome in relation to blockchain rules in various parts of the world which are giving rise to security concerns. Apart from that, it is one of the most promising technological methods in use today.