It's highly unlikely that you haven't heard about blockchain. To get a complete understanding, you may have taken the help of the internet, read a few articles or watched a few videos to figure out how it works. And now that you understand what it is, you're still confused. You might be wondering that how can this technology be used in the real world?
Well, let's take a gander at a few instances, but before that, let's quickly recap what a blockchain is.
In laymen terms, it's a distributed ledger, and everyone in the network can have a copy of it.
Everyone who has a copy can add new records of transactions to this database.
However, they cannot change history that is already in there.
It makes a blockchain a great alternative to store data transparently as everyone gets to see what's in it.
Now, the question is how can it be used in the real world?
For that, I have gathered some of the most common examples of blockchain applications.
When Bitcoin launched in 2008, it allowed people to make transactions with one another without having to trust any third-party like banks.
Since then, over 1600 different cryptocurrencies have got created.
However, let's look at the use of blockchain beyond cryptocurrencies.
Let's look at how blockchain applications are being explored to revolutionize various industries, for instance, cars.
You might be aware of the odometer fraud.
By tweaking the odometer, someone can make a car (or any mode of transportation) appear to be newer and less worn out, resulting in buyer paying more than the actual worth of a vehicle.
Although the government tries to tackle this issue by gathering the milage of cars when they conduct a safety inspection, that's significantly not enough.
Solution: We could replace the standard odometer with smart ones connected to the internet. Such odometers will write the mileage of the car to a blockchain in a distributed, transparent and immutable manner.
Thus, creating a secure, digital certificate for each car. And as we are using a blockchain, no one can tamper with the data, and everyone can see a vehicle's history.
Also Read: Blockchain becoming the Panacea for Automotive Challenges
Indeed, such blockchain application is being already developed by Bosch's IoT lab and currently in the pilot test stage. They are testing it on a fleet of 100 cars in Switzerland and Germany.
So, blockchain applications are good at keeping track of things over time.
Apart from the odometers, you can keep track of things like intellectual property or patents. You can even use a blockchain as a notary. A notary is someone who confirms and verifies signatures on legal documents.
However, we can use a blockchain for it.
For instance, an online website stampd.io allows adding documents to the Ethereum or Bitcoin blockchain. Once added, you can have permanent proof that you created that at a certain point in time. Much like a notary, although currently, blockchains aren't on the same level as traditional notaries from a legal perspective.
Today, people vote either on ballot papers or EVM machines that are running proprietary software.
Voting on paper is an expensive process and costs a lot of money. Also, electronic voting has security concerns.
In recent years, we've seen countries moving away from digital voting and adopting paper again as they fear that electronic votes can get tempered or influenced by hackers.
Solution: Instead of paper, we could bring into use blockchains to cast and store votes.
Such a system could prove to be transforming as everyone could see and verify the voting count for themselves as well as it would make tampering with votes or the system almost impossible.
The Swiss company Agora has already started working on such a system, and it's going to be completely open-source. But there's a myriad of challenges.
First, you have to be able to identify and verify voters without compromising their privacy.
Secondly, if you provide people the ease to vote from their computers or phone, it's important to consider the fact that those could be made infected with malware designed to tamper with the voting process.
And lastly, such a system needs to withstand denial-of-service attacks as it could make the whole thing unusable.
Unquestionably, a tough nut to crack but if it becomes a reality, it could lay the foundation for a more transparent, safer and practical voting system.
Let's move further to another area where blockchain applications can make enhancements:
The industry could use blockchain technology to track food products from the moment they have got harvested to when they reach in the hands of customers. There's a dire need to keep an eye on foods we're consuming as almost half a million people die because of the food-borne diseases. It's due to the time it takes to isolate the food that's causing harm.
Blockchain could help us to create a digital certificate for each piece of food, keeping a complete record of where it came from where it has been.
It can have answers to questions like:
So, on the detection of contaminated food, we can easily trace it back to its origin and notify other people who bought the same batch of it.
Walmart and IBM have partnered to devise such a system which allowed them to track the origin of a box of mangoes within a few seconds, compared to days or weeks using a traditional food tracking system.
A similar system could be applied to other industries as well. We could use it to track regular products and tackle counterfeit goods by enabling anyone to validate whether or not the product has come from the manufacturer you think it has.
Another use would be to trace packages and shipments by using a blockchain. That's something container shipping giant, Maersk and IBM are working on; creating a decentralized ledger to help make the global trading of goods more efficient.
Alright, so far we analyzed at ways blockchain applications to keep track of information and verify its integrity.
But blockchain's potential can be unlocked if we add Smart Contracts to it.
These contracts are small computer programs that live on the blockchain and can perform actions when certain conditions get fulfilled.
Insurance companies could use Smart Contracts to verify claims and execute payments.
With smart contracts, we can secure our data on a blockchain.
For instance, they can enable us to store our medical records on a blockchain and only provide access to doctors by approving with a digital signature.
Similarly, you could record personal information and choose what data you want to reveal.
For example, ordering alcohol in a bar would require you to prove that you're over the legal drinking age and with smart contracts, you can deliver the proof without revealing anything else.
Or think about collecting royalties for artists. A streaming service could set up two smart contracts: one where users send a monthly subscription to and another that keeps track of what the user has listened. At the end of each month, the smart contract that holds the subscription fee can automatically release money to artists, based on how many times their songs have listened.
The blog covers only the basics of how blockchain applications can get used, and it's by no means a complete list. That would make a very long blog as there is so much happening in this space.
Let me know in the comments below what your favorite application of blockchain technology is.
If you liked this blog, consider getting subscribed. Thank you for reading this blog. I hope to see you reading the next blog!