Technology is making giant strides and if we don’t keep up we may lose track of it. This year, Bitcoin and Blockchain technology was one of the most searched terms on Google. These two words are no longer unique and people know enough to drive the value of Bitcoin to $17,000.
Generally, Blockchain is ‘ the new kid on the block’ but its status is about to change in the coming year. Those who are not aware, Blockchain is the driving force behind the cryptocurrency, Bitcoin. But this technology goes beyond the Bitcoin and in this post, we will explore its extent.
What exactly is Blockchain?
Blockchain technology is a database for virtually every asset that is shareable across a site or a network of sites. In the past few years, Blockchain technology has been known as the distributed ledger.
The participants in a blockchain supported network have their own copies of the documents stored in the ledger so that they are informed of all the changes that take place in the document. This creates transparency that reduces the risk of fraud and miscalculation.
With Blockchain, all transactions are recorded and every participant has the copy of those transactions. In other words, all participants are on the same page.
Blockchain is a digital ledger, designed to be incorruptible, to record financial and other economic transactions on a virtually shared network.
Let’s take an example.
Google docs are probably the best analogy to explain Blockchain according to William Mougayar.
With Microsoft Word, you have a single document that is shared across different participants. In case of revisions, you have to wait for the other participants to share back the document with you.
With Google docs, the single document is shared with all the participants so everybody can see the revisions without having to share the document again.
Blockchain works like Google docs and eliminates the hassle that comes with Microsoft Word.
Now, the financial institutions around the world operate like Microsoft word and Blockchain aims to simplify the daily transactions much like Google Docs.
With Blockchain the possibilities are endless. From medical and health care to Fintech and everything in-between can benefit from Blockchain technology. See the following image to understand how traditional system differs form Blockchain-based system.
Financial Services covered by Blockchain
Blockchain impacts many aspects of financial services some of which include:
- Corporate governance
- Identity authentication
- Monetary transactions
- Financial asset storage
- Lending credit (mortgage and bonds)
- Funding and investing in assets
- Peer-peer financing
To garner substantial understanding, simply apply the concept of Google Docs on these financial services. For example, when the bank has a single distributed ledger, all monetary transactions are easy to conduct with absolute transparency that keeps the participants informed.
The Future of Blockchain
This year Blockchain market was valued at $411.5 million. The recent report suggests that this market will likely reach $7.7 billion by 2022. This spike in Blockchain market is backed by the consistent demand for Blockchain solutions in finance, health and other sectors that require data transparency.
Another study, American Bank Report, showed that the FinTech companies will likely have $4.7 billion in investment in the coming year with Blockchain being the primary investment target.
Peruse the statistics regarding Blockchain technology in the following infographic.
Let’s look at how the things will change in 2018 with regards to Blockchain technology.
Increased Crypto Resilience
Cryptocurrencies are designed to become stronger with every hack. The more a cryptocurrency gets attacked, the stronger and robust it becomes. In the coming year, we will see hacks, but in general, the robustness of cryptocurrency and Blockchain technology will improve.
Central Banks and Government will Embrace Blockchain
2018 will be the year of Blockchain. Governments and financial institutions will likely embrace Blockchain as an innovative system that eliminates fraud for transparent systems. This could be especially useful for voting systems.
Blockchain can assign identities to every human being regardless of their place of birth, which can create an independent identity for each individual that no other person can steal.
In addition, banks will embrace Blockchain-based systems for transactions and payments. And, the digital assets will become mainstream in the coming years.
Cryptocurrency value will Rise Exponentially
As Blockchain becomes mainstream, cryptocurrency will rise exponentially. Today, one Bitcoin equals around $13, 954. This value has gone from $5.30 to $18,000 (Literally, as we speak the value is rising.) In the coming years, it is predicted that the value will rise driving the demand for the cryptocurrency.
Blockchain-based applications will be much more secure for both individuals and businesses. With high privacy, accuracy, and transparency, Blockchain applications will enable strong analytics that will enhance business processes to drive more value.
Blockchain will Secure Self-driving Cars
Most people see Blockchain as just a digital ledger that could only be used around industries that run on transactions. But that is simply just one side of the coin; Blockchain’s ability to decentralize offers a great potential to reduce cyber attacks, which can make autonomous cars much safer, according to Kyle Therriault, Executive Vice President, Auto Accessories Garage. @AAGarage.
Blockchain will Improve Digital Advertising
Digital advertising experiences various challenges that include domain fraud, lack of transparency, lengthy payment models and bot traffic. Blockchain can bring transparency and trust that is important to maintain the integrity of the supply chain.
In 2018, we will see Blockchain become more than just a driving force behind Bitcoin. Many enterprises have adopted Blockchain for various business processes and it is very likely that in the next year we will see new business models around Blockchain designed to handle complex operational tasks.
The following image illustrates the Adoption Process for Blockchain technology.
Blockchain and Software Developers
Today, companies who adopt Blockchain find fewer barriers to entry. This is also a great opportunity for software developers to learn and grow for tremendous success.
Blockchain has yet to become mainstream, which means that software developers have the chance to prepare themselves and excel at Blockchain to increase future prospects for a well-paying job.
Nexapp.io is a software development and design agency committed to helping small and large enterprises find the best possible solution for their software needs. Learn more about software development best practices here. For questions and queries, contact us here.
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