Industry applications Of Blockchain Technology
Industry processes can be improved and solved by using distributed ledger technology. It can be used in many cases where trust services are needed by business applications. A World Economic Forum survey suggested that 10 percent of global GDP will be stored on blockchain by 2027. The key drivers for blockchain and industry growth are automation, connectivity and digitization. USD 2.1 billion would be global spending on blockchain solutions in 2018, according to IDC. Growth rate may be 42.8% till year 2022.
Blockchain has industry wide applications. For retail and CPG Companies applications such as warranty receipts can reduce disputes between retailers and customers for lost and unreadable receipts and track history of ownership. Smart contract based lease execution and termination for reduction in legal costs for oil and gas industry. Blockchain based record management system to enable companies to secure medical records and collaborate with network stakeholders. Blockchain technology can open new markets to farmers in agriculture sector by creating trust and accountability among market players. Farmers can get instant data related to the seed quality, soil moisture and others at decentralized platform to create direct link between farmers and consumers/retailers.
the innovation of bitcoin network. Blockchain technology is already beginning to disrupt cross border payments. India is the world’s largest recipient of remittances at INR 4.6 trillion per annum. Blockchain technology will expedite the same process to be concluded within 20 seconds through the decentralised aspect of blockchain. Since transactions are not required to be validated by an external entity, such as a bank so time required for these transactions are reduced. Banks such as IndusInd Bank and Yes Bank are adopting blockchain technology. Some other examples of blockchain technology in financial industry has below applications.
•Capital Markets: Trade Settlement has faster transfer of securities and payments and reduced trading cost by removing intermediaries.
•Banking Industry: Store financial information on decentralized
•Insurance Industry: Blockchain technology verifies identities, ensure completeness of applications, evaluate risk and complete quoting and binding.
Few of the global Companies which are implementing blockchain technology would be as follows:
•Banco Bilbao Vizcaya Argentaria in Spain has revenue of about USD 30 billion: The bank ranked number 116 on the Global 2000, has announced it closed a USD 87 million corporate loan using both ethereum and Hyperledger Fabric.
Blockchains may be in pursuit of developing an established, responsibly managed and regulated role in the global economy, soon after disintermediating a myriad of industries
•Alibaba Group Holding Ltd in China with revenue of about USD 38 Billion: Ranked number 81 on the Global 2000, this ecommerce Company has piloted a food supply chain using blockchain and plans to invest part of a USD 14 billion for innovation in the blockchain technology.
•IBM with headquarters in US has revenue of about USD 80 Billion: Ranked number 67 on the Global 2000 has open sourced the widely used Hyperledger Fabric and is a driving force behind multiple blockchain initiatives.
Governments of both developed and emerging markets are recognizing potential of blockchain. Denmark has implemented Vehicle Wallet. Vehicle Wallet is a partnership between payment service provider and the Danish Tax authority. It is a tool where data concerning the car is saved in one distributed ledger reducing risks for buyers and sellers, and helps Denmark government to receive proper taxes. In Ghana, Ethereum run digital register system of all land registries across Ghana. It is able to certify land information from satellite imagery and ground verifications. It aggregates all the information for realtime access to the data for financial institutions and other stake holders. Property transaction times have been reduced by 75% and court disputes have been reduced as per research of OPSI.
•Samsung Electronics with headquarters in South Korea has revenue of about USD 225 Billion: Ranked number 14 on the Global 2000, the Company announced its Nexledger platform for tracking global supply chains.
Blockchain technology provides the means for keeping a record of the holder in decentralized system, there may still be need to rely on traditional mechanisms to enforce owners’ rights as stated by Mckinsey. There could be concerns whether the blockchain should be public or private in industry applications. Data stored in the blockchain is accessible to all participants in the network if the public blockchain route is taken. IP concerns are for content stored directly on the blockchain. Private blockchain may have issues around governance for decentralization of decision making process.
Blockchain might one day redefine economies but for now the technology is immature as only 8% of CIOs are in short term planning and pilot execution as per Gartner research. Blockchains may be in pursuit of developing an established, responsibly managed, and regulated role in the global economy, soon after disintermediating a myriad of industries. Companies looking to utilize blockchain technology will be able to decentralize systems and operations all together. Blockchain will have a long way ahead to evolve as a trustworthy platform for scale and complexity of business interactions.