Blockchain is the latest technology used in financial technology.
Users often mistakenly associate blockchain technology with cryptocurrencies. Yes, on the one hand, digital assets and a decentralized system are inseparable. But cryptocurrencies are just one of the uses for blockchain.
In fact, the scope of such technology is much wider, and many companies can reap huge benefits from its use.
Blockchain allows companies to:
Simplify and speed up access to the information you need;
Automate business processes;
Reduce costs by eliminating unnecessary intermediaries;
Improve business efficiency with large amounts of data for analysis, collected in one place, and much more.
Blockchain technology has principles that will be useful in any area related to transactions. Many people understand the word “transaction” mainly as a money transfer. In fact, a transaction should be understood as any operation that can be fully completed. For example, registering a vehicle or registering a copyright can also be considered a transaction.
The blockchain is decentralized. This means that the technology does not have a single point of failure, and participants do not have to rely on it and depend on this center.
For example, you need to evaluate the quality of a product. But how to do this if the product is manufactured in another country? For example, Nitidae has developed the Cocoblock blockchain project, which allows you to track the origin of the harvest of cocoa beans.
Imagine a situation where you need to transmit an encrypted message, but you do not want to reveal your identity. The blockchain allows you to sign messages that are visible only to a specific addressee who owns the private key from their crypto wallet. At the same time, everyone can see your transaction, but only the recipient will know about the message.
Everything in the world has a price. Safety has convenience, and quality has a high cost, and so on.
In blockchain systems, information is not changed or deleted so that the database can grow to a huge scale. For example, the bitcoin blockchain now occupies more than 200 GB on the hard disk of each network node.
The design of blockchain-based systems has inherent scaling limitations. Many modern systems, of course, are capable of high transaction throughput.
Private access risks
As previously said, everything has a cost. The lack of insurance is the cost of autonomy. What data will be open and which will be closed is determined by the blockchain. The consumer or the corporation is in charge of non-public information.
Despite these flaws, blockchain offers useful solutions for companies dealing with vast amounts of verifiable data and allows knowledge verification easier. As technology advances, all problems will be resolved sooner or later.