Blockchain for business uses a shared and immutable ledger that can only be accessed by members with permission. Network members control what information each organization or member may see, and what actions each can take. Blockchain is sometimes called a “trustless” network — not because business partners don’t trust each other, but because they don’t have to.
This trust is built on blockchain’s enhanced security, greater transparency, and instant traceability. Beyond matters of trust, blockchain delivers even more business benefits, including the cost savings from increased speed, efficiency, and automation. By greatly reducing paperwork and errors, blockchain significantly reduces overhead and transaction costs, and reduces or eliminates the need for third parties or middlemen to verify transactions.
Your data is sensitive and crucial, and blockchain can significantly change how your critical information is viewed. By creating a record that can’t be altered and is encrypted end-to-end, blockchain helps prevent fraud and unauthorized activity. Privacy issues can also be addressed on blockchain by anonymizing personal data and using permissions to prevent access. Information is stored across a network of computers rather than a single server, making it difficult for hackers to view data.
Without blockchain, each organization has to keep a separate database. Because blockchain uses a distributed ledger, transactions and data are recorded identically in multiple locations. All network participants with permissioned access see the same information at the same time, providing full transparency. All transactions are immutability recorded, and are time- and date-stamped. This enables members to view the entire history of a transaction and virtually eliminates any opportunity for fraud.
Blockchain creates an audit trail that documents the provenance of an asset at every step on its journey. In industries where consumers are concerned about environmental or human rights issues surrounding a product — or an industry troubled by counterfeiting and fraud — this helps provide the proof. With blockchain, it is possible to share data about provenance directly with customers. Traceability data can also expose weaknesses in any supply chain — where goods might sit on a loading dock awaiting transit.
Traditional paper-heavy processes are time-consuming, prone to human error, and often requires third-party mediation. By streamlining these processes with blockchain, transactions can be completed faster and more efficiently. Documentation can be stored on the blockchain along with transaction details, eliminating the need to exchange paper. There’s no need to reconcile multiple ledgers, so clearing and settlement can be much faster.
Transactions can even be automated with “smart contracts,” which increase your efficiency and speed the process even further. Once pre-specified conditions are met, the next step in transaction or process is automatically triggered. Smart contracts reduce human intervention as well as reliance on third parties to verify that terms of a contract have been met. In insurance, for example, once a customer has provided all necessary documentation to file a claim, the claim can automatically be settled and paid.
Building trust between trading partners, providing end-to-end visibility, streamlining processes, and resolving issues faster with blockchain all add up to stronger, more resilient supply chains and better business relationships. Plus, participants can act sooner in the event of disruptions. In the food industry, blockchain can help ensure food safety and freshness, and reduce waste. In the event of contamination, food can be traced back to its source in seconds rather than days.
When financial institutions replace old processes and paperwork with blockchain, the benefits include removing friction and delays, and increasing operational efficiencies across the industry, including global trade, trade finance, clearing and settlement, consumer banking, lending, and other transactions.
In an industry troubled by data breaches, blockchain can help healthcare improve security for patient data while making it easier to share records across providers, payers and researchers. Control over access remains in the hands of the patient, increasing trust.
As pharmaceutical products move through the supply chain, every action is recorded. The resulting audit trail means an item can be traced from origin to pharmacy or retailer, helping to prevent counterfeiting and enabling manufacturers to locate a recalled product in seconds.
Blockchain can help governments work smarter and innovate faster. Secure sharing of data between citizens and agencies can increase trust while providing an immutable audit trail for regulatory compliance, contract management, identity management, and citizen services.
Insurance companies are using blockchain and smart contracts to automate manual and paper-intensive processes such as underwriting and claims settlement, increasing speed and efficiency, and reducing costs. Blockchain’s faster, verifiable data exchanges help reduce fraud and abuse.
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Built on a shared, immutable ledger that is permissioned, blockchain for business can increase efficiency among trusted partners.
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Smart contracts are a powerful component of blockchain networks. By automating business processes, they can remove friction between organizations, reduce operating costs, and speed transactions.
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