A blockchain, as its name indicates, is a chain of blocks that allow maintaining a distributed, decentralized, synchronized, and very secure registry of the information used by computers and other devices.
When we say the words “block” and “chain” in this context, we are actually talking about digital information or records (the “block”) stored in a public database (the “chain”). Each of these blocks depends on both the previous one and the one that follows, therefore, they cannot be moved within the chain.
What benefits could I get if I use Blockchain?
All network participants share the same documentation rather than individual copies. That shared version can only be updated by consensus, which means that everyone must agree. Changing a single transaction record would require the alteration of all subsequent records and collusion of the entire network. Therefore, data on a blockchain is more accurate, consistent, and transparent than when it is sent through paper-intensive processes.
There are several ways that Blockchain is more secure than other record-keeping systems. Transactions must be agreed before registering. The chains created are stored in the nodes of the network (which are points of intersection, connection, or union of several elements that come together in the same place) and thus store an exact copy of these. When new records are entered, they will be validated and verified by the nodes already stored on the network and will be added to a new block that will be linked to the existing chain. Once a transaction is approved, it is encrypted and linked to the previous transaction. This, along with the fact that the information is stored on a computer network rather than a single server, makes it very difficult for hackers to compromise transaction data.
If your business deals with products that are traded through a complex supply chain, you know how difficult it is to trace an item back to its source. When exchanges of goods are recorded on a blockchain, you end up with an audit trail showing where an asset came from and every stop it made on its journey. This historical transaction data can help verify the authenticity of assets and prevent fraud.
Greater efficiency and speed
When you use traditional paper-heavy processes, negotiating anything is time-consuming and prone to human error, and often requires third-party mediation. By optimizing and automating these processes with blockchain, transactions can be completed more quickly and efficiently. This is because record-keeping is done using a single digital ledger that is shared among participants, and when everyone has access to the same information, it is easier to trust each other without the need for numerous intermediaries. Therefore, clearing and settlement can occur much faster.
With blockchain, you don’t need as many third parties or intermediaries to make guarantees, you just have to trust the data from the blockchain. You also won’t have to go through as much documentation to complete an exchange because everyone will have authorized access to a single immutable version.
Does it have a future to make an investment in Blockchain?
The size of the global blockchain market is expected to grow from USD 3 billion in 2020 to USD 39.7 billion by 2025, at an impressive Compound Annual Growth Rate (CAGR) of 67.3% during 2020-2025, by making it an excellent choice for those who want to invest in an option with good expectations.
The growing need to simplify business processes and the need for supply chain management applications integrated with blockchain technology will drive the overall market for it.