Blockchain: What comes first? Opportunity or Threat
Blockchain is more than just a simple database. It is more than just a shared ledger and a data security protocol. If accepted and incorporated by the government and companies all around the world, this simple blockchain technology could easily revolutionize the way we conduct our business presently. Supply chain managements, payments and revenue streams would completely change at the face of it. However, nothing ever has just benefits and no downsides. There are two faces to every coin. Evaluating the risks and benefits is an important part of understanding anything new. Existence of several benefits and one single downside should not be the reason to cast aside something completely.
What is Blockchain?
A completely new and innovative way of data recording and digital currency transfer medium, blockchain is somewhat like a triple entry bookkeeping system in this digital era.
No single machine on the network has all the information required that would help an attacker to gain control of the information or value of any digital asset. All the information is distributed over the entire network and to attack such a wide network and override the system to commit a fraud or cyber attack would require a large amount of computational power. Eventually, this means that more the devices running using that particular blockchain software, more secure the entire protocol is.
Opportunities of Blockchain
Incorporating blockchain in your business changes what system you are in. Blockchain enables secure data transfer and payments. Blockchain tying up with Internet of Things provides for massive new opportunities to the businessman. One is no longer in just the business they think they are in. The manufacturer of a certain product or service would not just be the producer of that particular commodity but would also be the supplier of information regarding it. This facilitates the flow of a large amount of available information regarding a product or service. With the correct analysis of all this brand new information, better strategies and business models can be developed.
The hurdle is not just to transmit data or money securely but to also help the merchants understand the need to help make these transmissions in a cost effective way. This would make you the complete owner of whatever you wish to trade or sell. Be it large multinational organisations or just individuals, anyone can become the provider of data, services, and products and then receive the payments that is due to them without the need of several intermediate bodies to regulate and manage the entire process.
The adoption of blockchain technology would enable us to do business even more easily and efficiently with global overseas partners or firms or customers. This ease develops because of the easier and faster transmission of information or digital assets and a completely automated system of transaction record keeping which makes the entire process crystal clear and fraud free. This simplifies and somewhat automates accounting and compliance.
Threats of Blockchain
Blockchain is an easy and secure medium to transfer money and data. One of the risks attached to this technology is to take this inherent simplicity for granted. There is still a need to work out an approach to IoT data and money transactions. This network of monetizable money and data transfers brings forth the question of who would gain the most it. Would it be the individuals trading over this super network or the people who generate information or the people who manage these networks? One of the major threat in the long haul is that this technology would be so happily adopted and incorporated all over the world that the need for banks in the long future would be practically non existent.
Such a large scale shift of almost all the technologies in every company and government body in the world calls for a lot of efforts. It would require a lot of research and beta testing. This large scale shift requires a lot of pilot testing, investments in training, research, staffing and loads of crowdfunding too. Not just this, it would also require management buy in. However, when trust is hard coded into an system with such secure cryptographic techniques, people tend towards it more. They always prefer to see a proof of trust and not just rely on it by someone’s word. Obviously, with such a large scale incorporation, the gains would be limitless. It is of course an intelligent thing to always analyse the uncertainty of a new development, however, financial and economic experts have been agreeing far and wide that this uncertainty would massively be outweighed by the tremendous returns and benefits.