Trust is fundamental to business. However maintaining trust in this global economy which is extremely digital is expensive, time consuming and mostly inefficient. Businesses are now turning to blockchain to fill in the trust gap and provide a viable alternative to the current procedural, organisational, and technological infrastructure required to create trust in transactions.
What is blockchain, and why might it have the potential to profoundly transform some of business and government’s most basic operations?
Simply put, blockchain is a distributed ledger that provides a way for information to be recorded and shared by a community. It can be simply thought of as were the public ledgers in public squares and locations advising about changes in property. Instead of using a big black book and writing everything down, blockchain uses advanced cryptography and distributed programming to achieve similar results: a secure, transparent, immutable, repository of truth, designed to be highly resistant to outages, manipulation, and unnecessary complexity.
‘Immutable’ is a very important word when discussing blockchain technologies – this means that every transaction that is entered into the ledger cannot be modified or deleted in any way. With blockchain, cryptology replaces third-party intermediaries as the keeper of trust, with all participants running complex algorithms to certify the integrity of the whole.
Blockchain replaces the middlemen – who are prone to human errors, judgement calls and nepotism – with mathematics that makes this technology matter. The use of blockchain can reduce overhead costs when parties trade assets directly with each other, or quickly prove ownership or authorship of information this is currently next to impossible without either a central authority or impartial mediator.
Moreover, blockchain’s ability to guarantee authenticity across institutional boundaries will likely help parties think about the authenticity of records, content, and transactions in new ways.
Organisations across industries should aggressively explore scenarios in which blockchain could reinvent parts of their operations, value chains, or business models. They should look for ways blockchain could help bring new efficiencies to costly, slow, or unreliable transactions, and introduce new models for partnership and collaboration. What about designing products that leverage shared-ledger technology?
Whatever the specific play, it is time to dig in, gain understanding and experience, and determine if, or, more likely, where blockchain can help in your organisation.
James Catania is the lead consultant for Intelliblock, the premiere blockchain solutions provider in Europe, situated in Malta with more than four ICOs in the portfolio, offering the only blockchain certified developers and leading experts in legal, financial and technical which specialise in blockchain technologies.