Most of the hype and hysteria around blockchain technology has revolved around the performance and volatility of cryptocurrency as an investment. However, blockchain technology has a lot more to offer than just Bitcoins and other forms of cryptocurrency. This impact will be seen across various forms of businesses right from accounting to operations.
The crucial question that arises is what does this technology possess in order to make it useful for a business? A blockchain is an electronically distributed ledger or list of entries, much like a stock ledger, that various participants maintain via a network of computers. Blockchains use cryptography to process and verify transactions on the ledger. Encryption and coding improve transparency, efficiency, and trust in information-sharing. The following are the major implications that blockchain technology will have in the business world:-
Finance, Banking, and Accounting
Blockchain technology can be employed to exchange faster, more efficiently and more securely. Its features can be used by digital wallets, thus increasing the popularity of the same. Furthermore, blockchain technology can have a major impact on the world of tax and accounting. The way that blockchain technology works is that it gives visibility to all transactions for approved users. This directly reduces the work of auditors in terms of sampling and validating transactions. This will also help in precision and accuracy which is a paramount consideration in the world of banking and finance.
Information Technology and Cyber Security
With instances of data breach taking place with some of the biggest names in the industry such as Yahoo and Equifax, focus on protecting networks, computers, programs, and data from attack is now of paramount importance. Blockchain technology provides a way of recording transactions or any digital interaction in a way that is secure, transparent, highly resistant to outages, auditable, and efficient. It is these features that can be employed in a manner that could be used to form an effective cybersecurity system.
A smart contract is a computer code through which both parties can monitor and manage transactions in a transparent manner. When programmed efficiently, the program will ensure smoother execution of the contract as compared to the human-based alternative. It works as a self-executing program which does away with the requirement of middlemen in financial transactions or any other contractual agreement that has a set of verifiable parameters.
Although Blockchain technology is relatively new and there are still various experiments and trials taking place with the technology, it will not be long before its features can be used to create endless innovations.