More than ten years have passed since the creation of the blockchain, and blockchain adoption is only growing every year. According to surveys, 86% of senior executives believe that blockchain will soon become the mainstream technology and will be used everywhere.
Blockchain is now one of the fastest-growing and most widely recognized technologies helping businesses of all sizes. In this article, we will look at what benefits blockchain can bring for small and medium-sized businesses. Without further ado, let’s get started.
First of all, let’s talk about blockchain basics. Many of you might say that the most common use of blockchain is to send and receive payments anywhere. This is quite true, but blockchain has even broader possibilities for solving small and medium-sized businesses’ problems.
In more technical terms, blockchain is a distributed database that greatly facilitates transactions and asset tracking. Imagine a giant table that is present on several computers that are chained together. When you add some information to this table, it is updated for all participants in the chain with an exact note when the update happened. Such a blockchain system device gives rise to many myths among users. We will now debunk the most famous of them.
Famous Blockchain Myths
The myths around blockchain are wide enough and from this list are not entirely unfounded. Let’s take a quick look at them.
Myth #1. There Are One and Only Blockchain
Many people are confused by the fact that the blockchain is used in the singular, and one might think that there is only one blockchain. But in fact, there are a huge number of blockchains, and each blockchain differs due to the scope of application. Take Bitcoin for example. It uses public blockchains. In addition to Bitcoin, there are also private blockchain systems with access to a limited number of people.
Myth #2. Blockchain Is 100% Secure
We will not deny that the blockchain was created to improve the security of operations. But the blockchain is not an ultimatum method of protection since any system can be hacked if desired. However, in the case of a blockchain, the fact of hacking will be immediately recorded.
Myth #3. Blockchain Is Popular Among The Criminals
This myth features cryptocurrency and its supposed untraceableness, which can attract criminals. This myth is unfounded because the blockchain records all changes without the ability to delete data. Any transactions using cryptocurrency can be tracked after cashing out the cryptocurrency.
Myth #4. Blockchain Can’t Be Used for Business
Many people simply do not fully understand how blockchain works, and this may be the reason why many do not see the use of blockchain in business. In simple terms, the main task of the blockchain is to protect data blocks, verify the information and record all actions. These operations are beneficial for businesses that handle a huge amount of confidential data.
Ways How Businesses Can Use Blockchain
Now it’s time to talk about the most beneficial ways how businesses can adopt blockchain technology and use it to leverage their workflows.
Payments With Smart Contracts
One of the most common problems for small and medium-sized businesses is the control of money flow and transactions. And as you might guess, blockchain is designed to solve this problem. This is all thanks to a special technology used in the blockchain and is called “smart contracts”. This technology automates agreements and enforces contracts between customers and suppliers.
Imagine that a smart contract is a coded agreement that is automatically executed when certain conditions are met. This technology can create convenient transaction pipelines for thousands of businesses and thereby improve their efficiency.
Internet of Things
IoT and business have long been two interconnected things. IoT devices help to collect a colossal amount of information that helps make smarter business decisions. But how can blockchain improve an already good business tool? The entire array of information needs to be stored somewhere, and the blockchain is perfect for this. Blockchain can communicate with all devices simultaneously and serve as a kind of bridge between devices. These benefits significantly save business money for handling huge amounts of informati
Decentralization and Security
Even though there are no fully secure systems, the blockchain is a fairly secure system with no analogs at the moment. This aspect is achieved thanks to the decentralization that underlies the blockchain. Data on transactions and other operations are distributed to different systems that can be located thousands of kilometers from each other. Besides, this data cannot be deleted or edited in any way, making it possible to link each transaction with the previous one.
Supply Chain Management
Blockchain is a pretty valuable asset for enterprises looking to optimize their supply chains. As everyone knows, most products are not manufactured by one company, and when the number of suppliers grows progressively, it becomes quite laborious to control and track payments. In such cases, blockchain comes to the rescue. Blockchain-fueled supply chain offers convenient tools to track all transactions from the point of origin to the point of sale in real-time. For example, this can be in the form of an audit trail or other similar software.
Blockchain helps not only track transactions but also fight fraud, but also greatly simplifies inventory management. This operation has always been quite difficult for small and medium-sized enterprises, but with the advent of blockchain, warehouse operations are becoming simpler and more efficient.
Wrapping Things Up
As you can see, blockchain is a useful technology that can bring many benefits to both small and large businesses. This is manifested in increased efficiency and automation of internal processes, as well as the higher security level of confidential data. Now that you know a little more about blockchain, you can start thinking about introducing this technology into your workflows.