Even if you don’t closely follow technology news, you can’t have missed the rise of blockchain technology. There’s a lot of hype surrounding the blockchain industry, not to mention huge amounts of investment pouring in. The first thing people think of when they hear the word blockchain tends to be bitcoin, and this year has seen the famous digital currency’s price soar to new all time highs.
In addition to early adopters, retail investors and institutions are now getting in on bitcoin, but despite this, its price remains volatile. Bitcoin is not the only game in town though, as other cryptocurrencies such as Ethereum and Solana have also reached new highs, and in addition, blockchain technology is leading to new innovations in all kinds of fields, including art, gaming, and even healthcare, to name just a few. On top of that, we have Facebook rebranding as Meta and promising to launch a new kind of digital experience: the metaverse.
Amidst all the excitement you might start to ask, what can blockchain do, and what are it’s real life use cases?
Digital Money and a Store of Value
This is perhaps the most obvious use, and also the most disruptive. Blockchain technology allows us to have working digital currencies, and the most important of these is bitcoin. As first mover, it has established itself as a valuable asset, and seen its price rise to the point where some holders posit a six figure value as the next target. There is some debate, though, about whether or not bitcoin can ever be a true currency, used for daily purchases, or whether it will become more like a store of value or a kind of digital gold.
Either way, when you have blockchain-based digital money, you can also have decentralized financial services, such as a crypto mortgage, and peer-to-peer lending that cuts out middlemen and traditional banks. Smart contract blockchains, such as Ethereum, are driving this movement, which looks set to grow in the coming years. Nothing is certain at the moment, but we should recognize the possibility of substantial changes to the way that we conduct our financial affairs.
Secure Ownership of Virtual Assets
Some people in crypto are saying that 2021 has been the year of the NFT, but what exactly is an NFT? It stands for non-fungible token, which basically means it’s a crypto asset, like bitcoin, but what sets an NFT apart is that it is unique. That is, while one bitcoin is the same as any other bitcoin, and they can be interchanged, each NFT, while it’s still a digital token on a blockchain, is completely unique. What we’ve seen up to now is an explosion in the use of NFT technology to create digital art and collectibles that are verifiable, can be bought and sold, and whose ownership is secured.
Art and collectibles are just the beginning though, as NFTs can be used for music files, books, and to prove ownership of real-life, physical objects too. Recently, for example, NFTs have been utilized in the wine and spirits trade, allowing people to trade digital tokens that can be redeemed for real items. But the use case that really looks set to blow up in the near future is in gaming and the metaverse (meaning a virtual, online world), in which digital assets can be created and used, or bought and sold.
Supply Chain Tracking
As mentioned, blockchain technology can be used to attach digital tokens to real-life objects, and a potential application for this is in improving the way our global supply chains operate. Recently, there’s been a lot of disruption to the supply chains we usually take for granted, due in part to the pandemic containment measures that have been imposed around the world.
As such, it’s clearer than ever that our supply networks need improvement to remain secure and operational. One part of this improvement can come through blockchain technology. If product data is stored on a transparent ledger, then it becomes more secure and trustworthy, and a lot easier to access and track from any location. Furthermore, it puts all the data in one digital place, removing disorganized and easily corruptible paper trails.
With blockchain technology, it’s possible to create trusted, individual records that are in the full ownership of the person to whom they correspond. In other words, your medical records are your own secure digital property, and even if you use a variety of healthcare providers in a range of locations, your medical data will all be kept in one place, on the blockchain, in digital format and under your control.
This method is applicable to healthcare and medical records, but could easily be utilized in other settings too, for example to take of your education records and academic qualifications, or to hold tax information.
Blockchain technology is still in its infancy, and we can’t yet know for sure exactly how it will change our world. But what we can say with certainty is that it has tremendous potential, and is attracting a huge amount of interest.