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Blockchain Technology Is Bigger Than Crypto

Technology

Isadora Teich wrote this article

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It’s no secret that cryptocurrency has gone from a fringe pipedream to a mainstream hot topic. Today, the Coinbase cryptocurrency exchange platform is a publicly-traded company.

Tesla CEO Elon Musk is famous for his association with crypto and many established corporations are either already involved with it in some way, or have vast cryptocurrency investments. Business Analytics platform MicroStrategy, for example, made headlines for acquiring over $3 billion in Bitcoin.

However, even though it’s not as buzzy in the mainstream, the technology behind Bitcoin and other cryptocurrencies will likely have wide-scale future applications. These may change entire industries and potentially shape new ones.

So, let’s take a look at exactly what blockchain is, how it has been used already, and how people want to use it in the future.

What Exactly Is Blockchain?

If cryptocurrency is the flashy and attention-grabbing exterior, blockchain is the foundation that supports it all. To put it very simply, blockchain is a unique type of database. One of the main differences between blockchain and other databases is in how it stores data.

Blockchains store data in blocks that are then virtually “chained” together.

Blockchain is an incredibly effective way to organize information. As new data arrives, it will be entered into a new block. Once that block becomes full of data, it gets chained to the prior block.

As such, blockchain data is stored in chronological order. While blockchain, Bitcoin, and cryptocurrency have become synonymous in many people’s minds, they are not. Any type of information can be stored in this manner. Blockchain does not have to be exclusive to crypto or Bitcoin.

How Does Bitcoin Use Blockchain?

As Bitcoin is undoubtedly the world’s most famous blockchain application, it’s definitely worthwhile to understand exactly how it is utilized in this case. However, it is also important to keep in mind that this is just one use.

Bitcoin uses blockchain as a decentralized ledger for transactions.

Decentralized means that no one person or institution controls the entire ledger. This is the polar opposite of traditional banking, where banks keep private ledgers of all of your transactions that they control. In the case of Bitcoin’s decentralized blockchain-powered ledger, all data entered is irreversible and can be viewed by anyone.

If you are still confused, this helpful visualization of blockchain from Business Insider may clear some things up:

“It’s helpful to envision it as a strongly encrypted and verified shared Google Document, in which each entry in the sheet depends on a logical relationship to all its predecessors, and is agreed upon by everyone in the network.”

Beyond Cryptocurrency

Actually, blockchain surpassing crypto is not a far-flung sci-fi fantasy. It’s already happening throughout the world of business and tech. One place it is already making waves is in the world of traditional finance.

This is a natural crossover, as we have already seen how blockchain can integrate with currency.

Let’s take a look at a few of the many blockchain applications.

Blockchain in Traditional Banking

In this case, it is not even new. Banco Santander actually launched the world’s first blockchain-based money transfer service in April 2018.

If you have ever had to make international payments directly via banks, you know how expensive, time-consuming, and complicated it can be.

With Santander’s blockchain-powered Santander One Pay FX, customers can make same-day or next-day international money transfers.

Blockchain essentially automated the international money transfer process and reduced the number of intermediaries that this would typically require. Keep in mind that Santander is a vast commercial bank with numerous clients that can benefit from this.

Healthcare Applications

Something we have been following with great interest at Chop Dawg is the integration of technology and healthcare, particularly when it comes to what startups and apps can do to improve the quality of life for users and customers.

We recently covered the work of nurse turned startup founder Cassie Choi, who pivoted to health tech to deliver better care to underserved communities.

However, while many wonderful things have happened in this realm since the start of the pandemic, it is undeniable that many healthcare apps have been plagued with glaring security flaws.

Increasing Healthcare Security and Accessibility

Could blockchain be the missing piece of the puzzle when it comes to building secure healthcare apps?

It has actually already been at work in Estonia. Since 2012, the small European country has been using blockchain as a part of its nearly universal healthcare system. Currently, all of the country’s healthcare billing is handled on a blockchain, 95% of health info is ledger-based, and 99% of all prescription information is completely digital.

US startups are also taking note.

Doctor-backed and California-based health tech startup Akiri has been at work for several years with the goal of using blockchain to solve administrative and data management issues in healthcare.

Many startups around the world have been utilizing the blockchain-powered BurstIQ platform to do things like bring health tech to Nigeria, improve disaster relief in Texas, and bring consumers compact and secure at-home blood tests in the US.

A Super Quick Look At Other Blockchain Applications

Companies like Mythical Games and Dapper Labs are pioneering the world of blockchain gaming. Dapper Labs especially is credited with being one of the original pioneers in this new economy, as they released CryptoKitties, the world’s first-ever Play2Earn title, back in 2017.

Edtech startups like ODEM and Hyland Credentials are empowering students to learn and giving digital certificates to prove competency via blockchain.

Blockchain is especially big in perfecting supply chains and solving logistics issues. Startups Blockverify and Everledger improve these processes by giving users the means to detect counterfeit goods.

In the future, blockchain may become a standard part of global trade. Blockchain already has a presence in the energy, auto, agriculture, and telecom industries as well. Startup Voatz even wants people to vote using blockchain technology.

Some Roadblocks To Consider

While blockchain had its big break in the public consciousness as “that thing that’s kind of like Bitcoin, right?” it is so much more than that.

As you can see, it has been widely adopted by large corporations, forward-looking startups, and even the entire country of Estonia for health care purposes. However, there are a few big barriers to complete blockchain adoption to talk about.

For one, many business owners simply do not understand how this technology works, do not trust it, and do not want to adopt it. Another is that the complete transparency that this type of ledger offers is not desirable to many businesses. They don’t want their complete transaction history available to all network members.

It is also important to mention that this is an emerging technology still, so no one knows exactly how it will be regulated. This likely gives many large corporations who have been doing things the same way successfully for a long time some huge reservations.

On the flip side, blockchain is incredibly complex and expensive to create. This eliminates a lot of smaller actors from blockchain innovation and adoption. Some say it is actually slower and less cost-effective to use too. In 2019, Germany’s central bank conducted a blockchain experiment.

The bank president reported:

“A trial project using blockchain to transfer and settle securities and cash proved more costly and less speedy than the traditional way.”

Final Thoughts

This is a truly fascinating technology that is more than worth keeping an eye on, whether you are a crypto enthusiast or not.

It is likely that we will continue to find new ways to use blockchain technology as things progress as well.

Conceptually, it is not as difficult to wrap your head around as many people think. However creating, applying, and using it to alter entire institutions and economies is a whole other story.

Which blockchain applications are most interesting to you? Comment below. 

About ChopDawg.com: Since 2009, we have helped create 350+ next-generation apps for startups, Fortune 500s, growing businesses, and non-profits from around the globe. Think Partner, Not Agency.

 

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