Most people associate blockchain with cryptocurrencies, but there are more use cases of the technology than you probably think. In this article, we will highlight six promising blockchain applications and mention some decentralized projects built around them.
Blockchain has many applications beyond cryptocurrency and Bitcoin. It can be useful in many fields, including:
Why blockchain use-cases are so numerous and various? Because the distributed ledger technology (DTL) has several important features that can improve the way many industries work. These are security, peer-to-peer interaction, the immutability of verified data, and the ability to create smart contracts for managing everything of value. It’s possible due to the very structure of blockchain. If you seek to learn more about how the technology works, read this article.
All these features mean that in a blockchain network you can interact with other users directly, without an intermediary. You don’t have to trust or know anyone personally, as the system itself knows them and ensures trust. Also, it stores your data in a distributed ledger. Every user has an up-to-date copy of this digital database, but no one controls it.
Ok, let’s consider some blockchain use-cases in more detail now.
Blockchain and financial services are a perfect match, indeed. In this sector, the DLT can help by making transactions much cheaper and faster than they are now.
It would be especially useful in the case of cross-border transfers, which has always been costly and complicated. When you move money abroad, your bank has to deal with a number of foreign partner banks. They may have different working hours, IT systems and rules to comply with. It makes things more difficult for banks and expensive for clients.
A P2P blockchain system may be a good solution to this problem. It would eliminate the middlemen who take a certain percentage of the amount you send. You only have to pay a small operational fee for processing your transaction. Its size depends on the amount of data you send.
Blockchain-based payment systems could help millions of unbanked people, who now have restricted or no access to financial services. Everyone who possesses a smartphone with an Internet connection would be able to send and receive funds all over the world.
Recently, the blockchain tech has been attracting a lot of attention from major banks like JP Morgan. Although this tech threatens to disrupt them all, some financial giants are starting to explore the opportunities it promises. In the first place, they seek to streamline their own procedures, facilitate cross-border transfers and improve security.
Tokenization of assets is another amazing use-case of blockchain. Almost any asset — be it real estate, land, art, or whatever — can get tokenized. It means that any property becomes easier to deal with — you can ‘break’ it into small parts and manage it in a more convenient way. For example, it gives you a chance to buy a fraction of a tokenized artwork together with some other users. When this artwork grows in price, you may decide to sell your share.
Due to blockchain, small businesses and individuals may get access to the things that were inaccessible to them before. Also, it presents significant opportunities for investors, who can diversify their funds across a wider scope of assets.
Supply chains represent the steps any product makes to reach the final consumer. This chain includes many activities like designing, manufacturing, packaging, storing and distributing. It’s very important to manage these processes efficiently and make supply chains transparent and traceable.
Currently, it’s hard to ensure. The most common problems of supply chains are:
Blockchain is able to make the supply chain more transparent and traceable. It allows all the parties to view the correct and updated database. It also excludes the possibility of anyone tampering with the data it contains. All the steps of the way are verified, recorded and made unchangeable. Thus, you can be sure the product is authentic, features all the qualities the manufacturer declares, meets certain standards, and complies with all the regulations.
Thу DTL technology can also greatly reduce the number of thefts and counterfeits. It would be really hard for fraudsters to fish in clear waters of the blockchain-based supply chain.
Blockchain use cases in the healthcare sector are related to such major industry issues as poor patient data management, lack of pharma supply chain security and insurance frauds.
Everyone who has ever dealt with the healthcare system knows there’s too much paperwork, and many things are more complicated than you expect them to be. For instance, if you move to another location, your medical records don’t move with you. Your old clinic may be unlikely to share this info or pass it to your new doctor. It’s a common practice — medical institutions prefer to retain the records they made. It often prevents patients from going away. Clinics and hospitals can use this information for their own purposes or provide it to their partners.
As for supply chain security, it’s an issue of major importance when you deal with drugs and supplements. If you don’t follow this stuff from the lab to the counter, someone may steal or replace it on the way. As a result, we have a problem with counterfeit or expired drugs that are useless or even harmful.
The third big challenge is medical fraud. Patients may lie about their previous conditions and the character of their trauma to receive a bigger payment from their insurance company. Medical institutions and doctors provide false information to justify unnecessary surgeries and other costly procedures. Insurance companies lose a lot of money on it, and they compensate for this loss by making their services more expensive, on average.
We have already talked about how the blockchain tech can make a supply chain more transparent and traceable. It can also put in order our records, often inconsistent and scattered across different clinics. Every doctor who has access to the ‘single source of truth’ will have an overview of a patient’s medical history. It will allow him to assess your previous problems and prescribe a better treatment plan.
At the same time, nobody will be able to lose or compromise your data or use it the way they like. Finally, our personal data will be under our control. You may restrict access to this data, or share it for free, or even sell it to some research team. Transparency and privacy go hand in hand here.
As for medical frauds, they are likely to reduce both in frequency and scale. The reason is simple — with a transparent, consistent and immutable ledger it would be really hard to manipulate with data and hide the truth.
As we all are aware, there were many cases of data breaches and identity thefts in the Internet. The institutions storing our records are constantly updating and improving their security measures (at least we hope they do). But hackers are always at work, too. It’s a huge dark industry that evolves very quickly. Thankfully, blockchain is here to provide us with a solution.
The distributed ledger technology integration may totally change our approach to identity protection. Such a ledger could keep all the necessary biometric information — duly checked, confirmed and recorded. Each user would have to pass through an identity check and get a validated ID. After it, all the authorized organizations like banks will be able to view this info in an encrypted format. Instead of asking you to provide your credentials every time they need them.
Clearly, it should make our life easier and eliminate a lot of unnecessary friction. Not to mention all this hateful paperwork we do when we apply for a visa or renew our documents.
This blockchain use-case is less recognized, but it’s actually very important. Right now, the energy market of almost every country is under the control of several big corporations. It means, the market is centralized and there is no competition.
What the advent of blockchain can offer us here? For example, it makes possible smarter metering of electricity which is created by your own solar panels. In the areas with a natural abundance of sunlight, people often install such panels on the roofs oа their houses. Right now, there are several peer-to-peer projects seeking to monetize this trend. They use special blockchain platforms allowing you to trade the sun-generated electricity. If you have an excess of this energy you can sell it to the peers who need it, through a blockchain transaction. If things keep on this way, electricity will become a commodity you can trade. Instead of being fixed, the prices will adapt to the demand and supply rate.
As a user of such a smart-grid blockchain community, you will be able to compare prices from different suppliers and choose what is right for you. One such project is WePower from Estonia which is currently being tested.
To sum it up, the wider adoption of DTL technology will contribute to many economic sectors.
Some of them, like the healthcare industry, see the potential and are ready to invest in blockchain-powered projects. Others, like the financial sector, act with caution.
But it seems that everyone is at least interested, and it’s a good sign.