There’s no doubt the blockchain provides the prospect of changing the business world. And not just in small ways but in fundamental ways that can radically transform the way we do business.
Not only are we talking about some businesses possibly disappearing due to the change, much like what we saw with Kodak and Blockbuster, we are also talking about the eradication of entire industries. Indeed some industries that are major players in our economy today may become unnecessary in a world of blockchain.
In the firm belief that the future favors the prepared let’s take a moment, pause and look at some possible changes which may result from this upcoming technological changes.
The use of cryptocurrency, which is based on blockchain technology, presents the opportunity of removing, eliminating or at least lessing the use of banks in our economic system as money can be transferred directly between buyer and seller. This could fundamentally change how money is transferred between parties and the power structure within the government and the private sector.
Blockchain based payment systems, and blockchain inventory systems, linked to cryptocurrency for payment through smart contracts or otherwise, will allow payments that happen faster and without as many intermediaries. This will take some risk off the table for some parties, also allows for greater efficiency and eliminate many back-office record keeping functions.
We expect the use of blockchain, and it’s cousin cryptocurrency, will change how investments flow as well. Many of the brokerages and intermediaries that we see today may become unnecessary in a blockchain world. More and more trading and transactions will become peer-to-peer.
As blockchain becomes a trusted technology and is used for more and more record-keeping, the possibility of using blockchain for voting in elections becomes very probable. Blockchain technology can be used to remotely confirm the identity of a person and then allow them to cast a vote. This could change voter access (allowing more to participate) and then also change many of the issues we have today with tabulation and recording of voting results.
5. Internet Verification
For transactions where needed, it remains hard to do verification of identity over the internet. Sometimes a credit card or driver’s license number can be used. In more sensitive situations information from a credit file can be pulled and confirmed.
Event with these technologies it is still hard for everyone to know who they’re really dealing with over the internet because there are so many spoofs and frauds.
Properly implement blockchain may lead to a day where the identity of a person can be verified more easily in a remote setting. This will allow more and more transactions to happen over the internet or other remote technology.
We discussed earlier that investments may change and become more to peer-to-peer. This may mean the traditional exchanges, such as the New York Stock Exchange or NASDAQ may face challenges. There may not be as much a reason for people to take their transaction through the centers of commerce. In a true peer-to-peer world there’s no need for a third party to be involved in the transaction.
While we do a lot of forecasting in the modern world of today, there is one main limitation that’s ever-present that blockchain could address. In the current world often data cannot be accessed because it contains personal records or information relating to the population from which the data was derived.
Blockchain promises to be able to separate out the identity of the persons and allow access to other parts of the data so that a researcher can see what they need to see without seeing protected information. This would be powerful for big data studies in the areas of health, finance, retail or any other sectors where there’s a lot of history.
We expect as blockchain technology is implemented there will be more and more projects where large sets of data can be accessed and utilized for additional forecasting activities without disrupting the past data or giving up the identity a person’s originally involved in transactions.
8. Licensing of IP (Intellectual Property)
You have a lot of usage of intellectual property today (think of art, music and other creations) that are used in multiple places protecting intellectual property remains a fundamental issue.
Blockchain technology promises the possibility of changing this world of licensing. With the use of blockchain it will become easier to verify the ownership of properties along with their usage.This will open up possibilities in additional licensing and uses of artwork but also allow for better enforcement of violations.
9. Real Estate
In real estate a lot of time and energy is spent on verifying ownership.If you purchase a house, you’ll notice that there’s a great deal of cost and expense in confirming land records, mortgages and other items around confirming who owns or controls the real estate, or who might be owed money from the sale (such as liens).
A properly implemented blockchain system may help identify ownership in a coordinated system where verification becomes much easier and less costly.
Earlier in this article we discussed banks being under fire for cryptocurrency and blockchain. Additionally banks may become less and less necessary in financial situations. Right much of financing is done through banks. Under today’s model the banks collect money from depositors and in turn use that money into loans.
Blockchain may enable a world where peer-to-peer lending becomes much more practical. Persons with money to lend could then, through blockchain enabled solutions, lend their money to multiple people at one time with low-risk per person by using blockchain to divide the money efficiently. This would replace one of the essential functions of banks today in a much more low-cost environment.
In the insurance world there’s a lot of cost behind the scenes in administering policies, verifying claims and processing issues. Blockchain promises to change how data is stored and accessed in the insurance context. This means that insurance companies may have less issues in underwriting policies because they can access the blockchain enabled data easily to set policy premiums and terms.
Meanwhile because of the strong verify verification aspects of blockchain your maybe lower fraud and less cost in administering claims.
The privacy and data control issues in healthcare have long frustrated those that have attempted to do studies on large populations to improve healthcare outcomes. Blockchain, with its ability to allow access to some records and not others promises to help make larger research projects more practical.
At the applied care level, access to health records through blockchain may become much more efficient. This will allow doctors and other care providers to see a patient’s full history quickly and without much of the paperwork and hassle of today leading to better treatment at lower cost.
13. Supply Chain
Behind every transaction there’s a supply chain or group of people who are involved in getting the item from start to finish. Today there’s many transfers and paperwork along the way and it’s hard to trace where goods (or in some cases services) started and ended their journey.
Blockchain promises to enable the transfer of data between systems so that we used will be more certain where items are along the supply chain. We will also be able to trace better where items came from (think recalls, food scares and ethical sourcing issues).
This promises to drive out costs and make more efficient supply chains.
14. Energy Management
Blockchain will also enable the better management of energy and power systems. This can happen in a couple of levels. It may happen at the local level within a building or usage center of power and equipment. I can also happen on a city or national level.
With the correct use of blockchain and information sharing, multiple users of energy and power may be able to coordinate their efforts to reduce the burden on the system providers and to allow for more efficient scheduling and usage of power and power systems during peak periods like hot summer days in major cities.
15. Public Records
There’s great cost of maintaining public records. Governmental entities usually have large databases that they maintain and then access to that data is carefully guarded.
We foresee a world of blockchain where public records will be stored in a lower-cost environment. In turn that data will be accessed, as needed, by different people without giving access to all of the data.
Additionally, the usage of blockchain for identification or titling of goods or properties, may become a reality that allows more efficiency and tracing ownership or identity.
16. Statistical Studies
Blockchain will enable us to allow access to data in ways that we don’t today. By being able to verify who is accessing the data and to provide access to some data points (without access to other data points) we will enable more statistical studies and learning from large populations.
17. Guns and Restricted Items
There’s much cost in verifying the identity and background of persons that wish to purchase guns or other restricted items. Blockchain, with its storage systems and ability to verify identities, may allow a world where guns and restricted items become easier to monitor and maintain.
For instance, a potential gun purchaser may have a blockchain identity where their background check is already been done for multiple things such as licensing, employment and other reasons. As such, if that person wishes to purchase a gun we can look at these other background checks without doing new or repetitive work.
Charity may also be impacted by the use of blockchain as well. Right now charitable donations are often given in money or property. And some donors wish to be anonymous. The anonymity has limitations due to the human factors involved today – ultimately someone knows who made the donation. In the world of cryptocurrency and blockchain we can foresee truly anonymous donations where cryptocurrency and blockchain is used to protect the identity of the donor.
19. Human Resources
Recruiters will tell you that “all candidates lie.” It seems that almost everybody does some fudging of their history, resume or facts around their employment. A properly implemented blockchain system may allow the better transfer and usage of data regarding potential employment candidates and what we see today. For instance, blockchain may allow a potential employer to access academic or other records quickly and easily for verification purposes.
20. Government Licenses/Authorization
Ask any lawyer, accountant, engineer or other regulated professional and they’ll tell you that there’s a great cost to maintaining government licenses and keeping their authorization to do business. Much of this goes down to background checks and monitoring.
We foresee a world where government licenses and authorizations are easier to obtain (for the qualified) because background checks and other verifications would be easier to do at a lower cost.
21. Business Governance and Records
One huge cost in business is keeping records. This is both at the day-to-day level and at the top level of the company. One thing that almost every company of any size has is a ledger of stockholders. This is a database where who owns how many shares in the company is maintained.
In some interesting legal cases there have been issues in determining who actually owns a company on a particular date. This is because shares are floating around and moving between investors on a daily basis and these transfer records are often kept on a different computer systems.
Blockchain promises the ability to keep these records separately and provide access is needed driving down costs and increasing accuracy.
22. Life Expectancy
With all of these advances in healthcare, data access and other security measures we can expect that life expectancy will increase in light of the use of blockchain. This will then have other downstream effects on how we maintain our retirement system, our pensions, our health care system and other systems.
23. Lower Contract Risk – Less Legal Cost
Why the great promise uses of blockchain is smart contracts. This is where the parties agree in advance what’s going to happen when and they allow the blockchain to execute the steps when the time comes. This adds great certainty to contracts.
In the modern world there’s always a worry that you’ll do the work and the other person won’t pay. Blockchain enabled smart contracts can reduce this risk.
There’s a very real possibility when we get to a world where smart contracts are used regularly and linked to blockchain verification of facts (like the completion of a service to trigger a payment) or events that there will be less risk in contracts overall. There also will potentially be less legal cost in negotiating smart contracts.
25. Changing Court Systems
Blockchain will also change the nature of litigation. Records will be used in the blockchain system becoming more easy to verify. Additionally the use of smart contracts and other tools may change the nature and mix of litigation seen in your typical courthouse. We can expect that our legal system, and by extension are court system, will change with the enablement and use of blockchain.
Blockchain provides the possibility of many changes to our business world. And while many of these changes would be disruptive, they will also create great opportunities for others. The time to jump on this is now. Understand what is changing and get ahead of it before it gets ahead of you.
In each disruption listed in this article there is a great opportunity for you to snag some profitable endeavor to fuel your future.
Do you really want to make plans that work?
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