Blockchain and its impact in the business world

The blockchain technology is a database that links blocks of digital information in a secure and transparent way and that has come to revolutionize electronic transactions, in the same way, as in its time did the internet in communications.

It is called network distributed by the database that is replicated in different servers that have the same importance among themselves and are connected thanks to a P2P (or  peer-to-peer ) system.

Each block has an identification tag, or hash, which is repeated in the next block and which makes it part of a chain. Any modification in this chain must be verified by each of the servers, which must approve it in consensus.

This system, which is not centralized, provides security to each of the operations that are carried out, because the certification reached by consensus is not modifiable. Learn in detail how this infographic works:

Based on more than 40 years of research in cryptography, blockchain art became popular in 2009 when it was used to create the now famous Bitcoin cryptocurrency.

However, its applications go far beyond financial ones thanks to the inviolability of the data it offers.

Pros and cons

Like any disruptive technological advance, blockchain or chain of blocks, has gained strength as its advantages have been proven, but has also aroused some misgivings about its anonymity and impact on current processes.

Among its advantages are:

  • It is impossible to alter the information of one of the blocks without being detected by the P2P verification system.
  • The decentralization of the network protects operations against hackers or counterfeiters.
  • The constant checking of data by a network of administrators ensures that there are no errors or information is lost.
  • Intermediaries are eliminated in transactions, which lowers the costs of the same.
  • The operations are performed in real time 24 hours a day and every day of the week, which eliminates delays in the transmission of information.
  • The data contained in the blocks are accurate and private.
  • The users have the power over their information and their transactions.
  • The system offers greater efficiency when carrying out processes quickly and safely.

The disadvantages are focused on the difficulty to implement the system due to the advanced protocols required to function well and the unemployment that can generate in certain sectors by eliminating intermediaries in all types of transactions.

Its application in business

The first known use was that of Bitcoin and from there it happened to multiple financial applications. But beyond that, blockchain can have many uses in companies.

Among the sectors most favored by the use of the block chain system are:

  • Finance.  It streamlines transactions, which can be done at any time and in a matter of minutes, and reduces their costs by eliminating intermediaries.
  • Health.  It is possible to use digital signatures to control access to medical records, which can be shared, with prior authorization, quickly and easily among doctors, hospitals and insurers.
  • Legal services.  Allows the conclusion of intelligent contracts whose compliance can be monitored automatically.
  • Defending. The inviolability of information and the distribution of data guarantee that military equipment or networks can not be modified or violated and that any use must be authorized by consensus.
  • Public administration. It would improve citizen service if information can be shared in real time and corruption could be reduced by making all processes transparent.
  • Industrial digitalization. A system that offers the maximum protection of data allows to develop applications and advanced uses in the management of the same ones to improve the operative and productive processes and to improve the service to the client with total confidence in the quality and the privacy.
  • Social projects.  Transparency allows verifying the good use of the resources used by social enterprises, which gives greater confidence to donors.
  • Fight against poverty. The lower cost of transactions makes it possible for more money to reach the beneficiaries of remittance transfers made by economic migrants to their families in their places of origin and, therefore, improve their living conditions.
  • Management of individual identity.  For financial uses or to fully identify with the authorities, the system allows creating a digital identity registry that serves multiple purposes.

Its research and development took time, but the cryptography has borne fruit in a system of linked and secure information blocks that has endless possibilities and that is revolutionizing the way of doing online transactions.

What worries most users of electronic banking and e-commerce is the security of their data; with this technology, inviolability and transparency are guaranteed, as well as decentralization that avoids suspicions regarding the handling of information.

Banking is where its use has been most quickly adopted and where positive results are already being provided, such as the ease of conducting electronic transactions at any time and any day of the week.

Just as the Internet changed our consumption habits and our way of working, informing, educating and entertaining ourselves, blockchain promises to change the way businesses and governments operate with greater reliability and transparency.

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