Blockchain was born to give legitimacy to its master, the Bitcoin, after the financial cataclysm of 2008. But the servant has become the master, offering entrepreneurial benefits not foreseen during his conception. In fact, it is a paradigm shift in our understanding of the digital world and a game for those who can master it.
You may never have heard of the Blockchain art, but it’s only a matter of time before you find it. In this article, we will try to explain what Blockchain means and why it will be key in the future of digital networks.
What is Blockchain?
Blockchain, or chain of blocks, is a distributed electronic accounting book, which connects multiple parties in a trusted and secure network, facilitating the transfer of assets and information related to them.
To do so, it securely records digital transactions in a sequential chain using cryptographic digital keys, which are verified by the network as authentic. The duplication, edition or elimination of transactions is avoided thanks to the chain on which this system is based, which in turn is found on each user’s computer in the network.
The larger the chain of blocks and the wider the network, the more complex the digital key will be and, therefore, the more secure Blockchain will be.
A new business platform
Any type of trade requires the exchange of assets between two or more parties, and except in the case of barter, requires at least a third agent to act as an intermediary in the agreement, to trust the transaction and seek its benefit.
Blockchain alters this commercial system, bringing the parties together in a single trusted network, without needing a third party and registering each transaction sequentially and securely.
The use of this new trading platform can bring many business benefits:
Since the transactions are made directly between the interested parties, without intermediary and with digitized information, the settlement of the transaction can be quick. Added to this is the ability to operate “intelligent contracts” that automatically activate commercial actions based on satisfying the criteria established in the contract. This can drastically simplify processes and, in doing so, eliminate the time and cost of the transaction.
As each transaction is sequentially and indefinitely recorded, it provides an indelible audit trail for the life of an asset, even between the parties. This is especially important if the source data is essential to verify the authenticity of the assets.
Tracking goods in a supply chain can be advantageous when looking to track where the components are at a given time. The information relative to the component can be retransmitted to the owner, or vice versa, for a possible action.
The lack of commercial transparency can sometimes lead to delays in trade and a breakdown of relationships. Providing details of transactions, increases confidence in the process and generates more stable relationships based on transparency rather than negotiation.
As each transaction is verified within the network, using independently verified complex cryptography, the authenticity of the information can be assured. 100% secure information is one of the fundamental keys to take advantage of Internet of Things (IoT),in a closed loop cybernetic process that unites assets with actions.
With full traceability throughout the life cycle of an asset, asset designers and manufacturers can adapt asset management to their products to make them more effective. This will allow the return of information from the shipment, installation, maintenance or dismantling.