I bet many of you have your own bitcoin story. Maybe you bought bitcoin early and sold it a few years ago when it started to see marginal success? Maybe you just heard about it a few weeks ago and felt like it’s too late to get in the game? Or maybe you’re just confused by all these headlines about cryptocurrencies, digital mining, and … custom blockchain solutions. Hey, I get you. My cat is very much alive and very much scratches my new couch.
But what if I told you the biggest opportunity for businesses of any kind is actually related to the technology that underlies bitcoin — known as blockchain. Blockchain, the public ledger that records all bitcoin transactions, is more than just a fad — it’s changing life as we know it.
Payments and Cryptocurrencies
Cryptocurrencies are indeed one of the most popular custom blockchain solutions. But it’s impossible to talk about blockchain without taking a look at the application it was originally built for — bitcoin.
Partially because it was the first one and partially because it has the largest network of users, bitcoin is the most valuable cryptocurrency based on U.S. dollars. In fact, bitcoin has become so popular that stores, restaurants, and even bars are starting to accept it as payment. In larger cities like New York, you can live your life only paying in bitcoin, though it isn’t always the most practical approach. Bitcoin has also been used to cope with hyperinflation in Venezuela, as payment for online gambling, and for market speculation.
Because bitcoins trade on an open market, investors like the Winklevoss twins were able to make bets on future price movements. It’s impossible to know for sure, but it’s estimated that there were over 20,000 bitcoin millionaires at the start of 2018. But before you go investing in bitcoin, don’t forget that the cryptocurrency is also infamous for its massive price swings. Many lost fortunes speculating on the currency to the tune of $86.7 billion this year alone.
Other cryptocurrencies like Ripple, Litecoin, and Ethereum can also be used to send payments or for market speculation, but these cryptocurrencies have their quirks. Ripple is positioned to speed up international transactions and reduce transaction fees. The four seconds it takes Ripple to settle a transaction is faster than any other cryptocurrency and significantly faster than the expensive, multi-day process currently in use by most banks. For this reason, companies like American Express and Santander Bank have started experimenting with Ripple for international transactions.
These cryptocurrencies and, more importantly, the blockchain behind them will have a tremendous impact on trade. Faster verification times, reduction or removal of exchange fees, and elimination of errors will make domestic and international trade easier than ever before. By implementing blockchain within their internal financing unit, IBM was able to free up $100 million previously tied up in disputes. Imagine how much more could get done by using blockchain for the trillions of dollars in transactions that occur every day in the U.S. financial system alone.
Outside the worlds of insurance and international trade, blockchain will also create massive changes in the way businesses and startups raise capital. Sites like Kickstarter, founded in 2009, democratized fundraising by allowing just about anyone to find financial backing from a broad audience instead of traditional sources like banks and venture capital funds. There’s also a built-in insurance policy since payment only gets collected for projects that meet their funding goal. For this service and for connecting entrepreneurs to potential funders, Kickstarter charges a 5% fee. To date, the platform has raised over $3.4 billion in funds for various projects.
With blockchain, these fees get eliminated since a network allows for immediate verification and smart contracts allow transactions to take place only once a project is fully funded. Some artists and startups are already experimenting with blockchain crowdfunding in the form of ICOs or initial coin offerings. The virtual coins function the same way as bitcoin, and investors purchase these coins like shares of stock to invest in the business that offers them. However, unlike in the stock market, purchasing these coins does not mean a user purchased ownership rights — this makes ICOs an extremely risky investment.
Property and Identity
There are few things more important than protecting your identity and property records when it comes to custom blockchain solutions. Birth, marriage, and death certificates allow you to claim a variety of different rights, including citizenship, employment rights, and voting rights. Pretty important stuff.
In addition to being a digital fail-safe for important documents, blockchain is also an extremely secure identity management system. Being able to accurately verify your identity is essential to all online transactions, but the data you provide can be vulnerable to attacks. Custom blockchain solutions due to decentralized ledger and unique user addresses make it difficult for hackers to obtain your sensitive information.
That was a lot. And it’s okay if you don’t understand all of the intricacies of blockchain or aren’t ready to start incorporating custom blockchain solutions. So the next time you find yourself sinking into a deep hole of depression because you didn’t scoop up bitcoin while the iron was hot, remember the most rewarding technology — blockchain — is still to reach its full potential. We hope this has reached you and if you are on the way to look for blockchain solutions or service suppliers, contact SmartOCS. This is a full-service eCommerce agency that strives to build mutually successful, ongoing relationships with our partners and clients. We are a strategic partner to Magento, Sitecore, Shopify Plus, Salesforce Commerce Cloud, BigCommerce, AEM, Ucommerce, Kentico, and other platforms.
Contact us if you have any queries about Blockchain development services, dApps development, NFT marketplace development, Crypto wallet development, Smart contracts development.