In these series of blogs written like a tweetstorm, we are summarizing the best articles on blockchain technology (in our opinion) published on the web.
Read the first article here: http://blog.sabpaisa.in/best-articles-on-blockchain-technology-1/
This blog will summarize second such article – about which blockchain initiatives are finding adoption in the mainstream first and why.
The key points in the article are:
1. The key features of blockchain making it disruptive are: shared ledger, immutability, timestamped audit trails and cryptographically secured transactions
2. Because of these features, the opportunities that blockchain technology offers can be broadly classified into two buckets: creating efficiencies via streamlining existing processes by sharing information that currently sits in silo; and building new products / services using the power of technology and removing intermediation
3. Blockchain’s capability to create a shared distributed immutable ledger between various participants combines the power of distributed storage with cryptography and therefore the inability for any one party to change the state of the ledger without consensus. Shared ledgers will mean that need for reconciliations between various parties is reduced and manual or email based information and document exchange can be digitized away with online forms/documents that can be stored in an immutable ledger.
Some key examples of such applicability are Settlements in Capital Markets, Syndicated Loans in Banking, Supply Chain and Trade Finance in trading
4. A very interesting applicability of the fact that blockchain provides a clear timestamped immutable audit trail of all transactions and a great source of data linearity is that by virtue of having your information persisted onto a blockchain, you get automatic compliance – all you need is to create a node for your auditors/ regulators, and hey you are sorted. Tremendous effort can be saved in trying to collect and report on all the right information to your regulators, and this even makes any potential litigation efforts minimal
5. Another interesting category which enjoys maximum number of announcements from start-up organizations on applying Blockchain is one creating new business models. Cross border remittances is a great example of this category. Start-ups like Ripple, Abra and Venmo have made money transfer seamless for immigrants cutting multiple costs on the way. This obviously means that large financial institutions will lose out on market share in the space and the associated fees which has forced these organizations to look at blockchain and start experimenting with it.
6. Blockchain has this capability of helping to create new products and generating new revenue opportunities. Some examples of blockchain applicability creating new products are peer to peer renewable energy trading in the energy sector, flight delay insurance or micro-insurance in the insurance space, cryptocurrency based funds and assets in capital markets and new token based loyalty programs.
All these new products could very well also be launched using traditional technologies but blockchain offers them the ability to provide seamless and truly digital customer experience because of the shared ledger among the various parties involved in the servicing of the product.
This coupled with clear auditability and therefore reduced operational costs is a win-win for businesses
7. Despite these opportunities, there are challenges to blockchain adoption in the mainstream the top among which are: budgets, management sponsorship, technology, culture etc
8. Because of the aforementioned hurdles, projects that are taking off and becoming real first are those that create new revenue streams for organizations. The key reason why this is the case: blockchain is an ecosystem solution. Unlike other technology advancements like AI, Cloud, IOT and analytics that can be implemented within your own enterprise to seek efficiencies, blockchain requires that suppliers, competitors and regulators collaborate and agree to come onto the same platform and create an ecosystem that delivers a new experience for the end customer. Creating such an ecosystem for existing processes can be a complicated, time-consuming and costly proposition.This is one reason enterprises find it more rational to use blockchain for a brand new product or service as it is much easier than to bring together several organizations with a common goal to create something new and generate new monies
Read the article in full here: https://www.finextra.com/blogposting/15077/un-block-your-business-10-which-blockchain-initiatives-are-taking-off-first-and-why