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5 Big Industries Blockchain Could Transform
Blockchain technology has undoubtedly come to stay and the paradigm shift from a fully centralized system to a decentralized one is just a matter of time considering the plethora of benefits it offers. A study conducted by Gartner revealed that the incorporation of blockchain brought about over $4 billion in business value-add in the previous year. It is estimated that this value will grow to $21 billion by 2020 and over $3 trillion in 2030.
The widespread acceptance of cryptocurrencies such as Bitcoin and Ethereum in the finance industry also serves as a harbinger of the revolution to come. Now, with 3 in 5 banks actively supporting blockchain platforms, we can safely surmise that we shall witness extended applications in 2018. Some of the other big industries blockchain could transform are discussed here.
After the financial sector, this is another industry which has enjoyed significant investments. In 2016, over $55 million was put into a blockchain startup with AXA Strategic Ventures being the principal investor. The startup, Blockstream provides a ledger which serves to create, manage, and safely store company records in a secure and accessible ‘vault’.
With the application of blockchain in this sector, rather than keeping multiple files on one central hub, a single source of information is available in real-time to every party in need of it. This makes it easy to update and authenticate details when it is needed.
Even though ease and convenience are principal features of this application, it also improves efficiency by a large margin and helps to save cost. It helps to note that the decentralized platform is also instrumental in detecting and minimizing fraud. This will be particularly useful as McKinsey & Co. estimates that almost 10% of all insurance claims are fraudulent.
This is, perhaps, why Lloyd’s London Market announced that a modernization of their operating model plan is imminent, with blockchain technology being a crucial inclusion. To this end, they have come up with the Blockchain Insurance Industry Initiative (B3i), a consortium which boasts members like Achmea, Aegon, Swiss Re, Tokio Marine, and Zurich Insurance Group.
When it comes to adopting new technologies, the energy sector is always a pacesetter and the incorporation of blockchain technology is no exception. Companies like Spectral Energy and Power Ledger in the Netherlands and Australia respectively have already raised over $60 million to test practical uses of blockchain in this sector.
This technology will prove to be invaluable especially in the area of renewable energy integration as seamless peer-to-peer energy trading will be facilitated. Already, we have solar PV panels atop many roofs and Start-up Conjoule, a firm which supports this form of energy trading, has raised over $5 million in funding to this end. This company already has a pilot running in Germany and will expand subsequently.
Apart from renewables, smart contracts can also be relied upon in order to control the grid networks; initiating and authenticating ‘energy transactions’. Proper management via blockchain technology will help to create a balance between demand and supply, thereby making the grid more robust.
This might come as a shock to many, however, entertainment pundits already predicted this fusion a long time ago. Piracy has become a prevalent menace in this industry and one prominent application of blockchain technology will be the protection of artists’ rights.
If a decentralized system is successfully implemented, the music can be published on a ledger which generates a distinct code with every time stamp recorded. The immutable nature of this ledger means it cannot be modified, downloaded, or shared freely.
Benji Rogers, a musician with a penchant for tech, already has a startup (Dot Blockchain Music Project) which is making waves in this area. His goal is to develop the new protocol and the required online infrastructure in order to ease the industry’s adoption of blockchain technology.
OPUS, another startup with a similar goal claims that 97% of the revenue generated based on its system goes to the artists. There’s also a profit-sharing model which ensures that playlist-makers get compensated since they help to drive traffic to the artist’s work. Currently, a low latency IPFS is utilized as the storage layer for the songs and an Ethereum-based platform is employed to handle the transactions.
The transportation sector is also not left out in this wave. Uber, Lyft, and Taxify, no doubt, have carved a niche for themselves in the industry. Unfortunately, the advent of blockchain technology in this industry will make these companies either adapt or go out of business. This is due to the heavy reliance on a central database which controls the operation and management of drivers and clients.
With blockchain however, the marketplace enjoys a higher level of flexibility and structure. The distributed ledger creates a more user-driven marketplace and this undeniably regulates the industry. Currently, there is a startup called Arcade City which facilitates every transaction via a blockchain platform.
Instead of exerting an autonomous control over the drivers, they are given the freedom to dictate their rates, fares, and even additional services to render. Arcade City is definitely not the last of its kind.
Instant Messaging Applications
This list wouldn’t be complete without mentioning one of the biggest innovations the internet has ever seen. This year, we’ll either see new messaging applications with blockchain systems installed or the rise of blockchain incorporation in existing messaging apps.
Telegram, one of the pioneer encrypted app is currently having an Initial Coin Offering (ICO) and the aim is to raise $1.2 billion, the largest in history. With investors like Benchmark, Sequoia Capital, and Kleiner Perkins Caufield and Byers, Telegram’s plan might come to fruition sooner than expected.
Kik is another instant messaging application currently having an ICO while Line; a popular platform in Japan, aims to expand into trading of cryptocurrencies.
The rise of blockchain technology will turn out to be one of the most disruptive we have witnessed, no doubt. Apart from these 5 industries, other areas such as advertising, healthcare, manufacturing, and even governance will enjoy a decentralized operation. These innovative solutions promise to bring speedy returns on investment in a very short while.