Blockchain Technology – Meaning And Significance
Initially proposed in 1991 as a means of implementing time-stamps into documents to prevent corruption, blockchain has now developed into a technology used to create decentralized databases that are difficult to tamper with. Blockchains help share and store business records for real or digital property. In a blockchain peer-to-peer system, each new block that is created contains information related to the preceding block, thereby making a continuous, incorruptible chain. Well-designed blockchains are ledgers that are protected, easily and swiftly available, cost efficient, and exceptionally transparent. Gartner estimates an annual business value generation of more than $3 trillion USD by 2030 using blockchain technology.
Blockchain And E-Commerce
Nowadays, blockchains can be used to represent everything related to businesses, involving raw materials and finished products, transaction processing, customer service, income-generating securities, and even contract rights. In the E-commerce industry, blockchain technology has undeniable potential, primarily because the technology keeps data untampered, is quick, and streamlines business operations related to logistics, supply chain, payments, and connections between consumers and brands, by reducing intermediaries and cutting down costs. In digital commerce, prevalent blockchain solutions include Ethereum and Bitcoin, the cryptocurrency surrounding which blockchain was developed. Anyone with access to the internet can instantaneously participate in the global E-commerce space!
Advantages Of Using Blockchain In Digital Commerce
Let us take a look at some of the benefits blockchain technology has brought, popularizing it among brands and consumers alike :
● Safety –
For E-commerce companies, data theft and hacking issues are a major concern. A decentralized system, where data is corroborated by a network of reliable partners, assures a high level of safety. The chain system also prevents double-spending and ensures the genuineness of products.
● Traceability –
This is a benefit that many direct-to-consumer companies enjoy, thanks to blockchain. The time it takes to find the validated origin of a product through supply chains has been dramatically cut short through this technology.
● Anonymity –
Blockchain-based digital commerce services may offer customers complete or partial anonymity while conducting business.
● Decentralized finance –
Brands can generate capital globally, avoiding reaching out to banks or third parties. Consumers in developing countries can access a range of retailers from all over the world. NFTs have a huge role to play here.
● Cheaper than conventional modes –
Brands can automate several transactional processes related to a product through smart contracts. The paperwork cost involved in businesses can be effectively reduced by converting brands into Decentralized Autonomous Organizations or DAOs.
● Suitable for rewards –
Points and digital tokens that can be converted into any desired currency are another reason for the popularity of this technology.
While blockchain has found undeniable popularity owing to its usefulness and secure nature, the technology, which is slowly starting to mature, has a few barriers to overcome:
● Regulation and standardization –
The decentralized experience is not a smooth one for users due to lack of uniformity.
● Integration –
It is still difficult to make separate blockchains work together.
● Gaps in understanding –
Blockchain theory being abstract and completely technical, is difficult to understand, leading to a lack of trust.
● Scalability –
This is still an issue with blockchains, which may lead to congestion and slowing down of processes.
● Security –
Security is still an issue, with threats such as DDoS attacks or threats to the cryptographic algorithms employed.
Shaping The Future Of E-Commerce Through Blockchain
Decentralized data management is slowly gaining ground in the digital commerce space, with developing blockchain solutions. Leveraging the benefits that blockchain brings, along with a commitment to working with new technologies, is helping brands scale and develop in a secure and time efficient manner.
GeekyAnts– AI/ML development company has been keeping up with the evolving technologies surrounding blockchain, having already experimented and implemented it in supply management, e-voting, and global KYC chain. With experienced and updated developers, GeekyAnts is well on its way to discovering and sharing more as this novel technology develops and improves.