Blockchain technology is taking the concept of economic globalization to a new level by enabling peer-to-peer transactions without the need for a third party. For example, if you want to start bitcoin trading in only three steps, you will get the best liquidity, and the platform is immune to volatility risk. As banks and other financial institutions increasingly look for ways to maximize shareholder value, blockchain technology is one way that they can create efficiencies in their transaction processes, as well as achieve better risk mitigation. If you want to start trading in Bitcoin, click here.
The potential benefits of integrating blockchain into the financial system are readily apparent. However, these innovations will impact global trade distribution, sourcing networks, and supply chains will be more complex and uncertain. As a result, multiple companies are looking at how this new technology may impact their operations to capitalize on a potential influx of blockchain technology.
One company investing in blockchain is IBM, which has been researching the topic since 2008. They plan to mainstream blockchain by expanding from banking and finance to energy, supply chains, and government services. IBM’s plan includes launching a new joint venture with Walmart that will certify food products using IBM’s blockchain-based identity platform for Trust across Borders (TIB). Let’s discuss why there is a sudden influx in the blockchain industry.
Building Trust in Government
The United States healthcare market is projected to increase from $3.2 trillion in 2017 to $8.2 trillion by 2027. And thanks to the efforts of various government agencies and healthcare companies, the number of people on Medicare and Medicaid is expected to rise by 65 million over the next decade.
To keep up with this growth, the United States Food and Drug Administration is looking into blockchain to secure food product safety by tracking food shipments across global supply chains and building a network that can communicate with other federal agencies at multiple levels through secure tokens.
The potential benefits of blockchain to the healthcare system could be great, but we need to establish a level of trust with this technology. While some people are skeptical, others see blockchain as the future of clinical research. Healthcare companies are exploring a variety of products that use blockchain technology in their supply chains, and this is an area that has tremendous potential for growth.
All about Blockchain: How will it Impact Global Supply Chains
Blockchain applications that seek to integrate themselves into global supply chains need to address four key pain points for all types of businesses involved in global trade:
Transparency Challenges
A 2013 study found several challenges to transparency within global supply chains. By 2015, only 12.3 percent of multinational companies had adopted blockchain to help improve transparency along their supply chains. Blockchain technology is still a relatively new concept, and people can use it to address many of these pain points as it evolves.
Data Ownership
With conventional systems in place, data ownership is spread across many business stakeholders, leading to opacity and security issues that can lead to lower levels of trust within the supply chain network. As a result, companies are looking into how blockchain can be implemented as a way to establish digital ledgers in which data is maintained by one company and is kept available for all companies involved in the supply chain network.
Fraud Management
The financial sector is constantly looking for new ways to manage fraud and ensure the safety of funds. The introduction of blockchain technology into the financial system helps create a secure environment where users can share data across multiple parties to address issues of fraudulent activity and guarantee that funding and account information is kept secure.
Trust
Businesses look at blockchain technology as a way to establish trust within their supply chains by creating a single network that can work together with multiple companies operating along the same network. Companies are finding blockchain technology has potential in many areas, such as logistics, healthcare, and government services. Blockchain Technology in Global Logistics:
With the growth of e-commerce, the economy has become increasingly globalized. However, a new breed of blockchain applications is looking to improve international trade by applying blockchain technology in global supply chains. Companies combine blockchain technology with real-time shipping information to ensure that all shipments comply and have the required documentation. Users across a vast network can then track this data to ensure that proper documentation is issued at each stage in the process and that audits can be done as needed.
The blockchain powers ICOs
The ICO market is currently seeing considerable activity as more and more companies explore the potential of blockchain technology to improve areas such as access to capital. In addition, companies are using the ICO concept by creating decentralized autonomous organizations (DAOs), a new form of crowdsourcing and open-source projects that leverage blockchain technology to create an alternative funding model.
DAOs allow for a token sale (such as Ethereum-based tokens) while they retain control over software development, operations, and finances. Many industries are exploring how blockchain can be used as a way to improve existing systems and deliver innovative services.
Tokenization (the transfer of an item’s unique identity or attribute into a digital form) can be achieved using smart contracts, which allow for transparent tracking across different zones by using proof of existence at each point. Furthermore, through tokenization, companies can ensure that their products have maintained the required level of quality and authenticity and have followed all relevant regulations.
