Blockchain is a digital platform that aims to make any transaction (money, goods, contracts, and so on) more secure and transparent. It’s similar to a digital record book that’s checked and confirmed by an infinite number of unbiased computers worldwide. Blockchain isn’t just for digital-only or digital-first organizations. Restaurants, bakeries, collision centers, gyms, and other small businesses that rely on a physical presence can use the blockchain right now.
Let’s take a look at some of the advantages blockchain offers businesses:
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Contracts get smarter
So what are smart contracts?
According to American Banker Chris DeRose, smart contracts are “Self-automated computer systems that can carry out the terms of any contract.” Smart contracts are programs that run on a blockchain network when certain conditions are met. They are used to automate the execution of an agreement so that all parties can be certain of the outcome right away, without the need for any intermediaries or time waste.
All contractual terms and conditions can be replicated using a blockchain network, and distributed nodes or servers will verify and authorize their execution. Also, this cuts down on the time you’ll spend waiting for signatures and approvals.
Let’s consider a hypothetical solution where two businesses have an agreement for the purchase of 50 digital items – e.g. cool t-shirt images with the UBC heart &heart.
This agreement between the two parties (seller and buyer) can be installed on a blockchain network in the form of a smart contract so that its’ execution is transparent – i.e. both parties can see that the execution took place – and distributed in that many different computers running the same software actually run the routines defined by the smart contract.
Under the hood, during such distributed execution of routines, the conditions of the smart contracts are validated on several different computers at the same time. As a consequence of this, both the seller and buyer can make sure that each other respects the conditions of the contract – which they agreed to do preemptively.
Back to our hypothetical agreement between the two businesses – if the seller doesn’t receive the cryptocurrency on time, the merchandise would not if the seller doesn’t receive the funds on time, the merchandise would – note, that the hypothetical solution we are describing here does not plan with logistics, nor with any human mediation issues, let’s be honest, it is not usually as simple as that.
The transparent supply chain
A supply chain defines all the activities included in the process of manufacturing and delivering a product to the customer.
When something goes wrong in the traditional supply chain, it might be challenging to pinpoint the source of the problem because there are so many different suppliers, processors, and distributors that participate in a complete cycle. Blockchain technology adds transparency to the many activities that are part of a supply chain.
“Blockchain will offer us the capacity to not only track where the food originated from but also how it was produced,” says Frank Yiannas, Vice President at Walmart.nytimes
Other than adding transparency, integrating blockchain technology in supply chains will decrease the dependency on paperwork and speed up administration work, thus reducing costs. Another benefit of blockchain in the supply chain is the ability to identify counterfeits.
Read more about this in our article: How blockchain can be used to tokenize supply chains.
A global payroll
If you employ an overseas staff, paying them might be time-consuming. A cryptocurrency-based payroll service like Bitwage will “save both time and money for employees and employers alike” by “circumventing the time it takes for such payments to transit from bank to bank.” The distributed ledger idea of blockchain network allows real-time payment verification without intermediaries such as banks and clearing institutions. Payroll payment procedures can be improved, sped up, and made much cheaper by eliminating mediators, with banks playing a minor role, resulting in lower fees and less friction.
Blockchain is a technology that, in many fashions of it, ensures better security and ownership of data. Also, the fact that data cannot be updated anymore after having been added is helpful to ensure integrity.
In fact, thousands of neutral computers – also known as nodes of a network – actively check, verify, and store the rules of operation and make sure that those are being respected. Individual actors or groups of actors cannot tamper with or edit the data without others noticing – in the event that they would do so, they’d then fork-off onto a new network, forming a new – and breaking compatibility with the old – blockchain.
If you are reading this article you most probably are wondering about how can blockchain help upscale and improve your business. Answering the question of how can blockchain be used in a business would need more – much more- than a single post. As more businesses are starting to realize the importance of integrating this technology into their workflow, new use cases are being explored.
Generally speaking, blockchain technology can be integrated into almost any business to speed up the administration processes, increase security, facilitate payments, limit counterfeits, and ensure transparent transactions.
The way blockchain can be integrated into a business will highly depend on the nature of the business and the needs/vision of the business owners. If you are wondering about how your business can benefit from blockchain, UBC blockchain experts are ready to discuss the topic with you and study your specific business needs.
We hope that this article was insightful for you and are looking forward to any feedback and messages. Please share your thoughts in the comments section below!
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