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Blockchain and its Impact on Different Sectors
Technological experts and financial veterans have called Blockchain the next techno-financial revolution. They predict that it will have the same effect on finance and economy as the internet had over communication. Don & Alex Tapscott, authors of the book titled -'Blockchain Revolution' (2016), describe Blockchain as, "an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value." Now that we have defined Blockchain let's have a look at how it influences different sectors.
Blockchain's Widespread Adoption
In 2014, Barclays, HSBC along with the world's leading banking and financial institutions initiated the R3 Alliance. In China, China Ledger and Bank Ledger were also established in succession, with "Wanxiang Blockchain Labs" with an aim to research and promote Blockchain technology. IBM, Microsoft, and other traditional technological giants also made huge investments in this sector.
It seemed that the techno-financial world had pioneered into a new age, which witnessed mushrooming of technical talents, just like the star-studded 1980s. Everyone compared the Blockchain evolution to that of Internet's 30 years ago. Though not perfect yet, Blockchain has aroused people's infinite longing for its bright future.
At the same time, the state contribution could not be underestimated. The Federal Reserve System (FED) of USA pooled together 90 central banks around the world to hold a Blockchain meeting at its headquarters. While Britain was on the verge of exiting the EU, it was considering replacing Pounds with Bitcoin. Around the same year, Canada's central bank made an announcement regarding the development of Blockchain-based legal tender, while Sweden and other countries started trailing the usage of Blockchain to register land property rights. This was followed by China's central bank president Zhou Xiaochuan announcing that China would issue a separate "digital currency" for itself.
In retrospect, we can see that as long as the legal support is in place, Blockchain technology will witness faster development. Having talked about the intersection of Blockchain with the legal field, let's talk about the impact of Blockchain technology on the most modern technology ‘Artificial Intelligence (AI).'
Influence of Blockchain technology on Artificial Intelligence (AI)
Artificial Intelligence, commonly known as AI, has its share of critics, however, let's leave that debate for another time. Blockchain has been able to make inroads into AI as well, and before we proceed, it's crucial to understand Blockchain's credibility mechanism. For example, the device users need to register on Blockchain and achieve user access for different levels through the smart contract. This is done to provide personalized features for users at various levels.
To achieve this, Blockchain ensures that the device can achieve hierarchical access through user registration. This not only prevents devices from being abused but also protects users from any cyber damage. Blockchain also facilitates the shared ownership and usage of devices by allowing users to jointly set the state of devices and make decisions based on the smart contracts. Besides, such a registration mechanism will persist throughout the lifecycle of the device to facilitate various users, software, and hardware to assist the supervisor in confirming the accurate time points of device faults.
Blockchain and its Impact on the Internet of Things (IoT)
The Internet of Things is the technological phenomenon that has added infinite possibilities to what a meager common object has the ability to do. Blockchain experts believe that it can act as a catalyst for IoT, ensuring that it is better managed and well implemented. Centralized Management of IoT Devices: IoT aims to connect everything possible to each other via the internet. When we say everything, it actually means everything. Such a massive network with its infinite elements and connections leads to a challenge that many face issues with; the challenge of centralization and management.
Let's look at some stats and figures to give you an estimate how "large" this network of everything being connected to the internet is going to be. US research firm, Gartner Inc. forecasted in a report that the number of the Internet of Things devices around the world would reach 4.9 billion in 2015, generating revenue of 69.5 billion US dollars. While in 2020, this number of the Internet of Things devices will be around 25 billion, and the margin benefits related to the Internet of Things may reach 263 billion US dollars. With such massive scale and predicted numbers, companies need to aim at solving the data management needs for the Internet of Things. For organizations, Blockchain will act as their savior.
Blockchain opens the door for IoT's control to be decentralized. This is possible due to the decentralized feature of Blockchain that provides self-governance ways. It helps devices in the Internet of Things to understand each other, by aiding them in comprehending the relationship they have with each other. It also helps in achieving decentralized control over the distributed Internet of Things through addressing and permission control.
The image below should help you understand this more clearly:
Figure 1.Blockchain helps the Internet of Things to achieve "self-governance" and decentralization by establishing several regional centers
Blockchain and Big Data
With big data becoming a substantial part of how the world functions, more and more personal and sensitive information is on the network. This centralized database is like a piece of meat amidst a wolf pack and is prone to hacker attacks. Database leakage incidents are being reported more than ever before. Researchers are of the notion that Blockchain technology, due to its advanced decentralized features, is likely to become the preferred solution for improving big data security in the future. Its advanced decentralized feature ensures that no-one can control or edit the data. Hence, it prevents leakage of the entire database through the leakage of a single private key. Despite being enlightened enough to acknowledge that although there aren't yet any mature or famous cases on Blockchain's application in guaranteeing big data security. It is like a valve to be lifted, with a tremendous and an enlightening potential for development.
The figure below represents a global survey on the leakage of sensitive data:
Figure 2. Global survey on sensitive data leakage
It is evident that data leakage is not a rare phenomenon. Therefore, the root measure to solve the big data problem is to assign the ownership of the big data. This issue can be addressed by the decentralization features of Blockchain, ensuring safe sharing of big data while solving ownership issues. Hence, data is obtained and used by the masses themselves.
Previously, we talked about the role of Blockchain technology and the "public ledger." In fact, the value of the Blockchain technology has now far surpassed the concept of "cryptocurrency."
Blockchain and its Impact on the Financial Sector
Although global financial giants including NASDAQ, JP Morgan, Citibank, UBS, and Goldman Sachs are busy setting up Blockchain laboratories and making an investment in related technical firms, they may not want to reform the financial infrastructure as of now. What may interest them more is the application that helps them improve the efficiency of business operations and cut down costs. Block Chain is just the technology to help them do that.
Here are a rundown of some of the advantages of Blockchain technology can bring to the financial sector:
●Reduced Operation Costs:The business models of financial organizations work in the background, and usually, have long, internally linked procedures. Blockchain provides a possibility to simplify and automate these manual financial service procedures which result in reducing the overall operational costs significantly. This was endorsed by a report released by McKinsey & Company stating that Blockchain finance will achieve an electronic, Blockchain-based systematic trading of bonds, reducing the frontend and backend workforce costs.
●Improved Payment Efficiency: Blockchain is an attractive proposition for several banks, primarily because it can is a reliable, detail-oriented and irreversible record system with a promising payment application. A short-term impact can be seen with the global cross-border transfer market reaching $583 billion last year. A major contributory of this accolade was "Ripple," a payment settlement system built on the distributed ledger. Inspired by Ripple, Earthport also launched the distributed ledger service in August 2015. It integrates the potential of Ripple and cross-border payment service of Earthport while using local Auto Clearing House (ACH) to handle global settlements. At the same time, some financial organizations are carefully considering using Blockchain technology behind Bitcoin as an alternative for their clearance and settlement systems.
●Helps Meet Supervision and Client Requirements for Data Records: Deloitte believes that the Blockchain technology solves the persistent difficulties of the auditing industry to meet public demands along with the requirements of the supervision department. It ensures integrity, permanency, and incorrigibility of all financial data.
Conclusion
Blockchain technology is deemed to be an innovation that is set to change how the world functions. There seems to be no corner that it fails to touch or impact. Though it might be too early to call it the era of Blockchain technology; it surely seems to push the existing techno-financial systems to new heights.
最后更新：2017-04-01 17:13:52