Applications of Blockchain in industry

It is well known that blockchain technology is the engine room for cryptocurrencies, whereby digital currencies are created and stored electronically in the blockchain. From a business perspective, blockchain can be thought of as a next-generation business improvement software due to it being a collaborative technology. As a result, along with the increasing interest around cryptocurrencies in general, blockchain technology is also being analyzed for its potential applications in various industries. The use cases and applications of blockchain can provide a glimpse into future trends in these industries.

Capital Markets

The market participants in Capital Markets for whom blockchain-based solutions offer clear benefits are issuers, fund managers, investors and regulators. For issuers, cheaper and faster access to capital through programmable digital assets can be enabled by blockchain. Fund managers enjoy the benefit of faster and more transparent clearing and settlement which reduces default risk. New investor requirements for return, time horizon and risk appetite can be enhanced, thus creating a direct bond between capital seekers and investors. Blockchain’s immutable nature allows regulators to automate functions like compliance and audit. The major use cases of blockchain technology in Capital Markets are Issuance, Sales and trading, Collateral management, Clearing and settlement, Asset Servicing, Custody and Transfer Agency. Hence, it can be understood that blockchain is already having a substantial impact on Capital Markets operations and this is likely to be more pronounced with time.

Healthcare

The potential advantages blockchain offers to the Healthcare industry are vast. At a high level, this technology allows improved performance, data transparency, tracking and accountability and reduced costs. Enterprise Ethereum can secure Electronic Health Records (EHR) management by enabling secure and structured data sharing through decentralized databases. Blockchain solutions enable structured data ownership through privacy and permission layers built onto Ethereum. Drug supply chain management can become more secure, transparent and accountable using Enterprise Ethereum. Also, the consensus mechanism and decentralized structure of Enterprise Ethereum reduces the risk of fraud or manipulation of clinical trial data.

Retail

The core capabilities of transparency, tradability and traceability of blockchain provide multiple benefits to stakeholders in the Retail industry. Blockchain supports sustainable and transparent supply chain tracking and it has the ability to track any digital or physical product throughout its lifecycle. Today, sustainability is a buzzword in retailing and consumers are interested in knowing where an item has been sourced from, what is its background and any positive environmental impact of the purchase. This can be enabled by blockchain technology to redefine luxury and customer experience. Blockchain enables brands to tokenize non-fungible assets and these can be purchased, exchanged and traded easily. Consumer trust is another area which blockchain has capability to enhance, basically around providing information on customer data points and making this data accessible to all customers.

Commercial Real Estate

Being the largest asset class in the world, there is high potential for blockchain technology to optimize retail and commercial property sales, streamline payments and increase access to real estate funds and investment opportunities.  A major way in which Ethereum benefits the real estate industry is through the digital securitization of real estate properties; this makes the assets accessible to a wider investor pool and it can be leveraged to raise capital. Once these assets are “tokenized”, the programmable Ethereum blockchain allows the secure and compliant digitization of transactions and processes like issuance, trading and lifecycle management. Blockchain technology transforms the real estate industry with use cases namely, project financing, property management, urban planning, payments and leasing, loan and mortgage securitization and property development.

Insurance

The Insurance industry is highly dependent on customer value for money and a positive experience while being part of an insurance policy. Blockchain technology has the potential to bring about substantial efficiency gains, cost savings, transparency and fraud mitigation. Ethereum’s smart contracts and decentralized applications allows insurance to be conducted over blockchain accounts with more automation and tamper-proof audit trails. The insurance provided can be extended to crypto wallet collectibles with extensions for financial loss, professional liabilities and fraud. The many applications of Blockchain in Insurance include registries of high-value items, KYC and AML procedures, claims handling, reinsurance practices and distribution methods.

Final Thoughts

It can be observed that blockchain will have a major role to play in changing how industries operate. While some industries like financial services have already begun reaping the rewards of incorporating blockchain technology in their day-to-day processes, other industries will require more time to move to a more digitally oriented model. The immense scope offered by blockchain in redefining industries should be nurtured as we look to move towards a more streamlined model; in that regard, the current hype around blockchain-driven cryptocurrencies may just be a taste of what’s to come!