The blockchain is the latest technology that supports the use of cryptocurrencies such as bitcoins and it’s believed to be powerfully transforming the way people do business especially the transaction of monetary units from one region to another. Blockchain uses a decentralized ledger system which is secure and difficult to hack hence it works well with trustless operations. Also, blockchain allows the transfer of bitcoins without the involvement of a third party intermediary such as a bank thus cutting down operating costs for companies.
Today, many industries are discovering many uses of blockchain platform that has applications in areas where markets are inefficient and experience lack of trust. Blockchain also uses data that is very difficult to hack. In the near future, blockchain system is expected to radically change the way governments and corporate companies work.
According to Dr. Pandurang Kamat, Chief Architect at Persistent Systems, organizations are trying to build a future where one can send shares directly to someone without incurring transaction fees. Most financial institutions charge high transaction costs and in most cases, they are inefficient and takes about four to seven days for a transaction to go through. Moreover, corporate companies have to use several intermediaries and credit rating agencies for the transaction to materialize.
Furthermore, there are documents that must be physically delivered by couriers for signatures to be appended which takes a long time before the money is delivered. With blockchain platform, all such tedious processes are significantly streamlined without worrying about the integrity of documents and safety of money.
However, blockchain system works well only in cases where there is no efficient way of doing things and the business system is not trusted. In addition, blockchain is helpful where there are more than one participants involved in creating data and there are delays in the process for instance in the supply chains where invoices and payments can take long and conflicts may arise.
Blockchain technology ensures that all business transactions are precisely conducted and recorded and not only involve the monetary units but it can be used for other applications.