Bitcoin, and the blockchain technology behind it, didn’t disrupt the world as was initially thought when Satoshi Nakamoto published his invention in 2009.
More recently, however, digital currency, the IoT, and the blockchain have become some of the most widely discussed buzzwords. This is true not only in the payment industry, but across multiple industries. In fact, some believe that blockchain technology could eventually be more important than the internet.
For the time being, however, let’s take look at the 8 blockchain applications that could help your small business (and help you generate app business ideas in the process):
1. Payments and Money Transfers
Perhaps the most well-known blockchain application is being able to send and receive payments. Since blockchain technology has it’s beginnings in cryptocurrency, this makes sense. But, how exactly is this beneficial for small business owners.
By using blockchain technology, you’re able to transfer funds directly to anyone you want almost instantly and at ultra-low fees. That’s because there aren’t any intermediaries slowing down the transfer of funds between several banks and charging outrageous transaction fees.
This practice is especially useful if you have remote employees or are involved in the global marketplace.
2. Smart Contracts
Believe it or not, the term “smart contract”’ has been in-use since 1993, but now it’s associated with the blockchain thanks to the emergence of 2013’s the Ethereum Project.
This Project “is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.”
“Smart contracts” are “self-automated computer programs that can carry out the terms of any contract,” writes Chris DeRose in American Banker. In a nutshell “it is a financial security held in escrow by a network that is routed to recipients based on future events, and computer code.”
With “smart contracts” businesses will be able to bypass regulations. “Lower(ing) the costs for a subset of our most common financial transactions”. Additionally, these contracts will be unbreakable.
Companies like Slock, which is an Ethereum-enabled internet-of-things platform, is already using this application so that customers can rent anything from bicycles to apartments by unlocking a smart lock after both parties agreed on the terms of the contract.
Furthermore, global banks are using “smart contracts” to improve the syndicated loan market. One such company that is using blockchains to issue microloans is Synaps.
Blockchain technology can also be used as a convenient and inexpensive notary service. For instance, apps like Uproov, which is a smartphone multimedia platform, can be notarized instantly after a user creates an image, video, or sound recording.
Meanwhile, stampd.io, can actually be used to notarize proof of ownership of digital creation.
4. Distributed Cloud Storage
Distributed cloud storage will be another blockchain application that businesses can take advantage of. Storj, company that’s using the blockchain to provide users with affordable, fast, and secure cloud storage.
While talking to VentureBeat Storj founder Shawn Wilkinson said that, “Simply using excess hard drive space, users could store the traditional cloud 300 times over,” much like how you can rent out a room on Airbnb. Wilkinson added, “Considering the world spends $22 billion + on cloud storage alone, this could open a revenue stream for average users, while significantly reducing the cost to store data for companies and personal users.”
This makes distributed cloud storage one of the more interesting blockchain applications. It’s one for small businesses to keep an eye on.
5. Digital Identity
Did you know that fraud is estimated to cost the industry around $18.5 billion annually? In other words, that means that for every $3 spent, $1 is going to ad fraud. Because of that, security is a top concern for businesses of all sizes who want to utilize the blockchain wallet.
“Blockchain technologies make tracking and managing digital identities both secure and efficient, resulting in seamless sign-on and reduced fraud,” writes Ameer Rosic, founder of Blocgeeks, in a previous Due article.
“Blockchain technology offers a solution to many digital identity issues, where identity can be uniquely authenticated in an irrefutable, immutable, and secure manner,” says Rosic. “Current methods use problematic password-based systems of shared secrets exchanged and stored on insecure systems. Blockchain-based authentication systems are based on irrefutable identity verification using digital signatures based on public key cryptography.”
With blockchain identity authentication, “the only check performed is whether or not the transaction was signed by the correct private key. It is inferred that whoever has access to the private key is the owner and the exact identity of the owner is deemed irrelevant.”
Blockchain technology can be applied to identity applications in areas like IDs, online account login, E-Residency, passports, and birth certificates.
Companies such as ShoCard are using the blockchain to validate an individual’s identity on their mobile device.
6. Supply-Chain Communications & Proof-of-Provenance
“Most of the things we buy aren’t made by a single entity, but by a chain of suppliers who sell their components (e.g., graphite for pencils) to a company that assembles and markets the final product.
The problem with this system is that if one of these components fails “the brand takes the brunt of the backlash,” says Phil Gomes of Edelman Digital.
By utilizing blockchain technology “a company could proactively provide digitally permanent, auditable records that show stakeholders the state of the product at each value-added step.”
7. Gift Cards and Loyalty Programs
The blockchain could also assist retailers that offer gift cards, loyalty programs, and other digital assets by making the process cheaper and more secure by cutting out the middlemen and using the blockchain’s unique verification capabilities.
Gyft Block, which is a partnership between Gyft and bitcoin API developer Chain, issues digital gift card that can be securely traded on the blockchain’s public ledger.
8. Networking and IoT
IBM and Samsung have teamed-up for a concept known as ADEPT, or Autonomous Decentralized Peer-to-Peer Telemetry (a type of peer-to-peer network), which uses blockchains “to provide the backbone of the system, utilizing a mix of proof-of-work and proof-of-stake to secure transactions.”
With ADEPT a blockchain would act as a public ledger for a large amount of devices. This would eliminate the need of a central hub and would “serve as a bridge between many devices at low cost.” Without the need of a central control system, all of these devices could communicate with one another autonomously in order to manage software updates, bugs, or manage energy. This blockchain application is particularly relevant for companies building software that’s compatible with systems, and similar IoT devices.