All over the world, several industries are exploring different ways to integrate blockchain into their business and transform their traditional business models. Healthcare, financial services, government, supply chain, and many other industries have already started implementing blockchain technology in their business. Many businesses also wonder whether the cost and labor of updating an existing infrastructure with blockchain technology worth the trouble.
So, the question over here is, is it essential to use blockchain technology? Why should the industries use a distributed ledger when there are a legacy system or regular database system of record in this digital world? To answer these questions, here are five benefits that show the advantages of using blockchain in the industry.
Decentralization
Decentralization provides better security to businesses and corporations. In today’s world, the largest corporation exists in servers and a centralized data system. These servers are a lucrative target for hackers. Even with the best security, there is always a sense of danger of being attacked by best hackers. Decentralization can prevent this problem as it becomes difficult for hackers to attack. All nodes on the network have the same data, and even if one node breaks, it does not have any impact on the system.
Redundancy
A distributed blockchain technology helps in distributing the same set of data into multiple places around the world. Also, the shared data is extremely secured and practically impossible to lose or alter. For small scale and large scale business, this is a very crucial advantage as it eliminates the problem of leaks and hacks. Also, because of Proof-of-Work system, blockchain offers immutable transactions. So, it becomes impossible to tamper with the data.
Cost Reduction
Cost reduction is usually on the priority for most of the business. Blockchain technology eliminates the use of intermediaries and third parties to make guarantees as it does not matter whether you can trust your trading partner or not. Instead, the businesses have to trust the data on the blockchain. Moreover, this technology excludes the use and revision of documentation to complete a trade. This is because everyone has permission access to a single, immutable version.
Greater Transparency
The use of blockchain technology has enabled a transparent transaction history. Since blockchain is a type of distributed ledger, all network participants have the same copies as opposed to proper documentation. If one wants to change a single transaction record, then it needs to alter all subsequent documents and cooperation of the entire network. Hence, data and information available through blockchain is more accurate, transparent, and consistent as compared to the paper process.
Improved Traceability
Supply chain industries deal with a complex trading process which makes it difficult to trace the product or item back to its origin. Whereas with blockchain technology, the exchanges of goods are recorded and it provides a complete audit trail that shows every stop an asset made on the journey along with its initial position. This historical transaction data helps in preventing frauds and verifying the authenticity of the assets.
We hope you have found this article informative and interesting. For more information or queries visit at ICO Development and know more about this technology. You can also contact us or send us an email at sales@icodevelopment.io