Blockchain Applications or so-called Dapps (Decentralized Applications) are a buzz word today and every company in almost every industry is trying to implement this new model or integrate this with their existing business models.
Blockchain Applications means the apps which have blockchain as their backend or you may simply say the apps that run on the blockchain. Well, Blockchain is not a new name in the world of technologies. At its most basic level, the term ‘blockchain’ is literally just a chain of blocks.
If you don’t know what exactly a blockchain is, let me introduce you to a brief discussion about it.
So, when we say the words ‘block’ and ‘chain’, we are actually talking about digital information (the ‘block’) stored in a public database (the ‘chain’). In simple words, ‘blocks’ on the blockchain are made up of digital pieces of information.
Coming to the blockchain applications, we can say that the digital world deals with the Internet, where Internet deals with digital assets, nowadays. Earlier, people used the Internet for sending and receiving e-mails, chat, and read articles. But now, the Internet has changed!
Today, people deal with their most valuable assets in digital form, namely ‘money’ and other financial transactions and even other important informational transactions.
However, these valuables can now store in an encrypted network chain called the Blockchain, which functions as a public ledger. This not only protects your business dealings and prevents theft, but, also, simplifies your affairs, fastens the process, reduces errors, and saves you from hiring a third party.
The blockchain is going to change everything in your financial world. Everything from voting, purchasing your goods, renting a car, to the way you manage your assets will be disrupted with this technology. It is also going to change the way that banks, schools, colleges, hospitals, and even governments conduct their business.
For the above-mentioned reasons, it is important to understand how blockchain is going to change your life.
Following are the list of blockchain applications that are transforming our society:
Traditional trade processes within asset management can be expensive and risky, particularly when it comes to cross-border transactions. Each party in the process, such as broker, custodian, or the settlement manager, keeps their own records which create significant inefficiencies and room for error. The blockchain ledger reduces errors by encrypting the records. At the same time, the ledger simplifies the process, while canceling the need for intermediaries.
Processing claims can be both frustrating and expensive for insurance companies. The firms are required to sort through fraudulent transactions, fragmented data sources, and abandoned policies to name just a handful of complaints. User error on behalf of employees and the customers themselves is also a significant problem. The blockchain can help create an almost perfect, risk-free system for better management and transparency for all stakeholders. The additional layer of encryption of each record can further afford insurers some peace of mind. In November 2019, BIMA, an International Insurance Company, has entered into a partnership with Coins.ph that will allow over 5 million customers to pay for insurance using Coins.ph wallet.
The global payments sector is error-prone, costly, and open to money laundering. It takes days if not longer for money to cross the world, as it often takes days for the money to be sent across international borders. The blockchain is already providing solutions with remittance companies such as Abra, Align Commerce, and Bitspark that offer end-to-end blockchain-powered remittance services. In 2004, Santander became one of the first banks to merge blockchain to a payments app, enabling customers to make international payments 24 hours a day, while clearing the next day.
Unconventional Money Lenders/Hard Money Lending
Smart contracts can revolutionize the traditional lending system. For instance, unconventional money lenders (e.g. hard money lenders) service borrowers who have poor credit with needed loans, while charging two to ten percent of the loan amount and claiming their property as collateral. Too many borrowers fall into bankruptcy and lose homes. Here, the blockchain can be used to let a stranger loan you money and take smart property as collateral. This would eliminate the need for credit and work history checks, with no need to go through each application document manually. The property, and who it belongs to, would be permanently stored on the blockchain for everyone to see.
Primitive forms of smart property exist. For instance, your car-key may be outfitted with an immobilizer, where the car can only be activated once you tap the right protocol on the key. Your smartphone too will only function once you type in the right PIN code. Both work on cryptography to protect your ownership. The problem with primitive forms of smart property is that the key is usually held in a physical container, such as the car key or SIM card, and cannot be easily transferred or copied. The blockchain ledger solves this problem by allowing blockchain miners to replace and replicate a lost protocol. On November 6, 2019, Volvo announced that it used cobalt recorded on a blockchain for its car batteries after the revealing of its fully electric XC40 Recharge model in October 2019.
Blockchain Internet-of-Things (IoT)
Any material object is a ‘thing.’ It becomes an internet of things (IoT) when it has an on/off switch that connects it to the Internet and to each other. By being connected to a computer network, the object, such as a car, become more than just an object. Now, it is people-people, people-things, and things-things. The analyst firm Gartner said that by 2020 there will be over 26 billion connected devices. On a larger scale, cities and governments can use IoT to develop cleaner environments, more efficient energy use and so-called ‘smart cities,’ to improve how we live and work.
A smart appliance is a device that connects to the Internet and gives you more information and control than before. For instance, a code connected to your appliance can be linked to the Internet and alert you when your cookies are ready or if your laundry has stopped. These alerts keep your appliances in good condition, as they save you money regarding energy efficiency and help you control your devices when away from home, among other benefits. Encrypting these appliances on the blockchain protects your ownership and enables transferability.
Supply Chain Sensors
Sensors give companies end-to-end visibility of their supply chain by providing data on the location and condition of the supplies as they are transported around the globe. As of 2016, a Deloitte and MHI report surveyed 99 leading supply chain companies and found that sensors were used by 44% of these respondents. Eighty-seven percent of these industries said that they plan to use the technology by 2020. According to the report, the technology is expected to grow to 1 trillion by 2022 and to 10 trillion sensors by 2030. The blockchain stores, manages, protects and transfers this smart information.
Personal health records could be encoded and stored on the blockchain with a private key that would grant access only to specific individuals. The same strategy could be used to ensure that research is conducted through HIPAA laws, in a secure and confidential way. Receipts of surgeries could be stored on a blockchain and automatically sent to insurance providers as proof-of-delivery. The ledger, too, could be used for general health care management, such as supervising drugs, regulation compliance, testing results, and managing healthcare supplies. On September 26, 2019, MediConnect established a foundation and methodology for proof of concept finalization, which authorizes recording and managing of prescription medication through the supply chain — from manufacturer to end-users.
Key problems in the music industry include ownership rights, royalty distribution, and transparency. The digital music industry focuses on monetizing productions, while ownership rights are often overlooked. The blockchain and smart contracts technology can circuit this problem by creating a comprehensive and accurate decentralized database of music rights. At the same time, the ledger provides transparent transmission of artist royalties and real-time distributions to all involved with the labels. Players would be paid with digital currency according to the specified terms of the contract.
In the 2016 election, Democrats and Republicans questioned the security of the voting system. The Green Party called for a recount in Wisconsin, Pennsylvania, and Michigan. Computer scientists said that hackers can rig the electronic system to manipulate votes. Private individuals can confirm that their votes were counted and confirm who they voted for. The system saves money for the government, too. The blockchain ledger, also, provides a platform for what we call “responsive, open data.”
According to a 2013 report from McKinsey and Company, open data, freely accessible government-sourced data that is available over the Internet to all citizens can make the world richer by $2.6 trillion. Startups can use this data to uncover fraudulent schemes, farmers can use it to perform precision farm-cropping, and parents can investigate the side effects of medicine for their sick children.
The blockchain can facilitate self-organization by providing a self-management platform for companies, NGOs, foundations, government agencies, academics, and individual citizens. Parties can interact and exchange information on a global and transparent scale. An example of the blockchain’s use here is Google Cloud, except its platform would be larger and far less susceptible to risk and misuse.
Smart contracts can ensure that electorates can be elected by the people for the people so that the government is what it’s meant to be. The contracts specify the electorate’s expectations and electors will get paid only once they do what the electorate demanded rather than what funders desired.
Whether we like it or not, online companies know all about us. Some companies whom we purchase from sell our identity details to advertisers who send you their ads. The blockchain blocks this by creating a protected data point where you encrypt only the information that you want relevant people to know at certain times. For example, if you are going to a bar, the bartender simply needs the information that tells him you are over 21. Similarly, the blockchain protects your identity by encrypting it and securing it from spammers and marketing schemes.
Blockchain technology offers a solution to many digital identity issues, where identity can be uniquely authenticated in an irrefutable, immutable, and secure manner. Current methods use problematic password-based systems of shared secrets exchanged and stored on insecure systems. Blockchain-based authentication systems are based on irrefutable identity verification using digital signatures based on public-key cryptography. In blockchain identity authentication, the only check performed is whether or not the transaction was signed by the correct private key. It is inferred that whoever has access to the private key is the owner and the exact identity of the owner is deemed irrelevant.
The first digital passport was launched on Github in 2014 and could help owners identify themselves online and off. How does it work? You take a picture of yourself, stamp it with a public and private key, both of which are encoded to prove it is legitimate. The passport is stored on the ledger, given a Bitcoin address with a public IP, and confirmed by blockchain users.
Birth, Wedding, And Death Certificates
Few things are more important than documents showing that you are born, married, died which open your rights to all sorts of privileges, such as voting, working, citizenship, yet mismanagement is common. In 2013, UNICEF reported that up to a third of children under the age of five have not been issued a birth certificate. The blockchain could make record-keeping more reliable by encrypting birth and death certification and empowering citizens to access this crucial information.
We carry a range of identifications, such as our driving license, computer password, identity cards, keys, social security ID, and much more. It is a digital form of ID that is engineered to replace all these forms of physical identification. Fintech scientists said that in the future, you will be able to use the one digital ID for signing up at any registrar. It is open-source, secured by the blockchain, and protected by a ledger of transparent account.
Distributed Cloud Storage
Cloud storage services are centralized, as the users must place trust in a single storage provider. “They” control all of your online assets. On the other hand, with blockchain, this can become decentralized. For instance, Storj is beta-testing cloud storage using a blockchain-powered network to improve security and decrease dependency. Additionally, users (you) can rent out their excess storage capacity, Airbnb-style, creating new marketplaces. Anyone on the Internet can store your data at a pre-agreed price. Hashing and having the data in multiple locations are the keys to securing it. Storj.io and Factom are two start-ups exploring this idea. After encrypting your data, it is sent out to a network with easy to track basic metadata.
Smart contracts are digital which are embedded with an if-this-then-that (IFTTT) code, which gives them self-execution. In real life, an intermediary ensures that all parties follow through on terms. The blockchain not only abandons the need for third parties but also ensures that all ledger participants know the contract details and that contractual terms implement automatically once conditions are met. You can use smart contracts for all sorts of situations, such as financial derivatives, insurance premiums, property law, and crowdfunding agreements, among others. Making property smart decreases your risks of running into fraud, mediation fees, and questionable business situations.
At the same time, it increases trust and efficiency. These are legally binding programmable digitized contracts entered on the blockchain. They are smart because they are automated and can self-execute. What developers do is to implement legal contracts as variables and statements that can release of funds using the Bitcoin network as a ‘3rd party executor’, rather than trusting a single central authority.
The greatest barrier to getting electoral processes online, according to its detractors, is security. By using blockchain, a voter could check that his or her vote was successfully transmitted while remaining anonymous to the rest of the world. In 2014, the Liberal Alliance, a political party in Denmark, became the first organization to use blockchain to vote. With American voter turnout still shockingly low, distributed digital voting may represent a way to enfranchise non-participants.
As in all cases, the blockchain ledger provides security to this Internet of things. With billions of devices linked together, cybersecurity experts worry about how to make sure this distributed information stays secure.
It is important to note that the blockchain could become a powerful tool for improving business, conducting fair trade, democratizing the global economy, and helping support more open and fair societies.
The future potential of the blockchain applications is still unraveling. The next couple of years will be all about experimenting and applying to all aspects of society. Regardless of which application comes first on a global scale.
Thus, blockchain is here to stay and is transforming how our society functions.