It’s one of those terms that has many of us non-techies glazing over, but blockchain offers real benefits that merit wider appreciation.
So – for the uninitiated – what exactly is blockchain? Perhaps it’s best to start by describing what it does. The basic concept of blockchain technology is to bridge the trust gap between people and/or organizations, enabling them to share valuable data stored in multiple computer servers in a secure and tamper-proof way. Once data is recorded, it is very difficult, if not impossible, to change, and this is Blockchain’s core strength.
Schematically, blockchain is a chain of information blocks, a data ledger that is distributed, decentralized, and immutable. Every block in the chain has these basic elements: data, time-stamp, hash, and hash of the previous block. Data can comprise information of any type, such as amount, sender, recipient, and address.
Hash is an encrypted alphanumeric identification code that is unique for every block in the openly distributed ledger. Because each block is chained to its predecessor, tampering with the data in an individual block will make all the subsequent blocks invalid. The invalid block will then be replaced by the valid records stored by other devices.
Let’s look at some uses of blockchain…
Financialand legal
- Cryptocurrency
Sometimesthere is confusion between the terms cryptocurrency and blockchain. They arenot the same but are interrelated in that cryptocurrencies such as Bitcoin orEthereum use the blockchain protocol to run on and underpin their security. Youcan think of the cryptocurrency as the application and blockchain as theoperating system. With thousands of cryptocurrencies emerging, blockchain willremain a valuable enabling technology in the financial world.
- Financial processing fees
Blockchainsecurity offers the disruptive prospect of bypassing processing fees imposed bybanks and thus lowering transaction costs for consumers. It remains to be seenwhether regulatory bodies in different countries will allow this to happen, andwith banks themselves investing in blockchain, the picture is still cloudy.
- Smart contracts
Facilitated by the immensely secure blockchain platform, smart contracts Explanation enable two or more parties to fulfill the terms of a pre-prepared contract using ‘If-This-Then-That’ logic. With each step and obligation rapidly confirmed and verified, it can ease and speed complex or high-value agreements.
Retail
Blockchain has application across almost every aspect of retail.Here are just a few examples:
- Product authenticity
Blockchain allows easy tracking of products through manufacture and supply, warehousing, customs, distribution, retail and after-sale warranty. The result is that the consumer is assured of product authenticity and corporate image is safeguarded. Luxury brands such as Louis Vuitton, Cartier and Prada have partnered with Aura Blockchain Consortium to tackle counterfeit goods
- European automotive compliance
Groupe Renault,Simoldes, Faurecia, Knauf Industries and Coşkunöz came together to develop theXCEED (eXtended Compliance End-to-End Distributed) blockchain project tocertify the compliance of all vehicle components, from design to production.This new blockchain solution was developed in association with IBM.
- Recall management
Faultyproducts batches can be tracked and recalled within a shorter time as all thedata in the supply chain is documented. This improves the trust betweencustomer and brand.
- Delivery logistics
In2018, global transport and logistics specialists, Kuehne+Nagel, adoptedblockchain technology to upgrade its VGM (Verified Gross Mass) Portal. Determining the VGMof shipping containers is essential to ensure the safe loading of cargovessels. The company also uses Vechain’s blockchain technology to ‘smartify’parcels and assets – especially luxury goods – by furnishing them with a chipcontaining a private key that registers ownership information on theblockchain.
- Inventory tracking
Brands including Walmart, Carrefour and Amazon use blockchain systems to keep their inventories updated. One of the chief benefits of blockchain inventory management is that it allows accurate forecasting of demand, helping companies to optimize sales and profitability.
- Online/physical transition
Through theeasy and secure identification of individuals, blockchain can improve thecustomer experience and encourage loyalty by assisting a smooth transition betweenshopping online to shopping in a physical store.
Events
Blockchain has wide application within our own industry:
- Visitor data. Secure blockchain technology can be used to validate and hold attendee data for online registration and tracking – especially for virtual events.
- Ticket sales. Various blockchain ticketing companies such as Aventus, Cloudchain and Eventa can help efficient ticketing and fraud prevention. Blockchain enabled smart contracts are a major step forward in the secure management of ticket purchase, payment, refunding and resale – all to the benefit of attendees.
- Incentives. Special offers can be made to attendees through secure tokens or credits as part of the event marketing strategy
- General management. Event organizers and planners can manage complex pools of vendors and suppliers, covering aspects such as venue booking, security, catering, audio-visual, lighting, talent and many other services.
To summarise, blockchain technology is gaining popularity acrossmany industries but still faces many challenges before it achieves universaladoption. For example, it needs a widely accepted governance and regulatory framework.It also needs to bring all the eco-system players together, notjust to achieve better business outcomes but to keep the interests of theconsumer in focus.
Privacy of data and associated legislation in some parts of the world is still a concern that must be addressed. A fundamental of blockchain security is that it does not erase data. Consequently, it is important for companies to choose the appropriate type of blockchain for their organizational and legislative environment.
While it will take time for blockchain to mature, it continues to show great promise, and we at CDI World look forward to applying it whenever and wherever it can benefit our customers, within a number of the services we offer.
Take a look at our other blogs in this series
- Behind the Scenes at CDI World: Capturing Our Spirit
- Global Exhibitions Day 2024
- BYD Singapore: Harmony Auto at 77 Robinson Road
- Driving Engagement: The Secrets Behind BYD’s Electric Vehicle Roadshow in Singapore
- The Changing Landscape of Face-to-Face Marketing