Blockchains — A Catalyst for Digital Transformations: Applications
This post follows from the first part in the series available at:
What are some exciting applications of BlockChain today?
We discussed 3 use-cases in the first post of this series.
However, there are many more applications of BlockChain as we shall see.
Before we step into the applications, How and Why is BlockChain making a case?
Do not expect overnight transformations using BlockChain.
BlockChain is more of a foundational technology — it isn’t a snap-on to make things better. It is a foundational platform that will evolve and the future applications are going to be very different from what we are visualising today. Technology adoption takes time and
There is this brilliant article on HBR by Marco Lansiti & Karim Lakhani, that compares BlockChain to TCP/IP.
Rise of the TCP/IP:
It took 30+ years for TCP/IP (Transmission control Protocol/Internet Protocol) to get adopted and realise the benefits that we enjoy today.
Started with Circuit Switched Networks, where dedicated lines were responsible for the transmission of data. Imagine laying the lines dedicatedly between establishments and networks and sustaining it through the exchange. TCP/IP digitised the packets and split them, equipping them with address information that mentioned the destination of the packets and the packet information that mentioned the sequence # of the packet for assembling at the receiver end. These packets were introduced into the network and were free to follow any path, thus obviating the need for dedicated transmission networks. The packets could ‘hop’ their way to their destination and could be received with the minimal of losses.
The focus turned to how shared open networks could be made better to enable this transmission of data packets. From local use for e-mail within ARPA to becoming the de-facto for transmission of data — the journey has been possible because of staged progress:
1970s: usage within an organization (e-mail within ARPA)
1980s-1990s: Localized networks based on TCP/IP — Sun, NexT, HP, SG
Mid 1990s: Development of the World Wide Web, Netscape Browsers, Java for application programming, AltaVista, Yahoo to start engaging users on the ‘Web’
Late 1990s-Early 2000s: News, Shopping move online to enable further adoption along with social networks and communication technologies — Skype et al.
It was actually a journey of 30+ years and plenty of support + creation of assisting ecosystems. It has been building on the platform and first making it robust enough for innovation. Innovation resulted in new products, new applications, new ecosystems and new technology that speeded up the use and adoption further. BlockChain will have a similar journey, with its ‘hops and misses’.
What have been some interesting applications of BlockChain?
To begin with, BitCoin is not BlockChain.
BlockChain is the underlying platform on which Bitcoins have been created. Bitcoins, or other cryptocurrencies provide a means for secure exchange of value without the use of intermediaries in the digital economy.
Bitcoins and other crypto currencies are just one application of Blockchain. The blockchain principles of immutability, distributed databases, peer to peer validations and security lend themselves to many many derived use cases, some of which we will discuss here:
Content creation, consumption and costing — these are the areas where BlockChain is making a difference. Imagine an artist posting directly on the BlockChain. Aided by SmartContracts, sharing and licensing of music will be much simpler. Producers or individuals wishing to use the music (or even a part of it!) can just subscribe to the rules laid out in the contract, use what they want and pay for what they have used. Each contract transaction gets added to the chain for reference and triggers/alerts as part of the smart contracts ensure timely payments and appropriate access. Cutting out intermediaries will result in the artists getting more value for their work! Imagine, what an artist earns after millions of views on YouTube Vs what is possible with posting on the blockchain.
Finance and Fintech have been great supporters of BlockChain so far. A discussion with a FinTech major on using Blockchain in a peer to peer lending platform turned to a PoC in the works. Insurance, Payments, Cross border transactions (as we saw with the Jordan refugee camp), Know your customer (KYC) and inter/intra-bank transactions are some areas under exploration. From saving costs with the removal of intermediaries to faster processing in case of insurance and payments, BlockChain is also helping reduce the cost of transactions. Usage in the financial domain, however, is going to take extensive testing and validation of all security scenarios before widespread adoption can happen.
About six years ago, during a consulting assignment with a UK power aggregator, we broached upon the usage of smart meters and smart grids. Just 3 years does the line, blockchain is a major consideration in the energy sector with more than 100 energy based startups working on various aspects of energy/power management not limited to Energy rating, Grid optimisation, power distribution, metering, power usage optimisation and supply logistics. The costs associated with intermediaries is high and that’s an apparent benefit that a well-researched blockchain implementation will help realise. with IoT, blockchain can ensure a network of trust among the devices, making connection and communication instant and secure. Data theft, Hacks & DDoS will now be much much more difficult thanks to the protection offered by Blockchain.
D. Law and Order:
We hear of many cases that run for years and are finally dismissed, either because the witness turned sides or that critical evidence was lost. Blockchain can be a safe place to stash away all evidence in chronological order so that evidence tampering becomes almost non-existent. Original testimonies, court recordings, crime scene photos adn case briefs — all these and other supporting documentation will hep build a case as time goes on. Best part — all evidence is available for anyone wishing to work on the case and get a detailed unbiased view of the happenings so far. Building offender portfolios is also a great application. From petty thieves to errant drivers, the history of every individuals crossing into the wrong side of law can be ‘built as they err’ leading to easier judgements and punishments. This way you wouldn’t see known paedophiles roaming the streets after spending just a couple of years in the cooler.
From hospitals maintaining a clear patient history to better public records, the uses of blockchain are varied. There is a dearth of understanding on what has a patient undergone. Many treatments are repeated and especially if the patient or his kin are not educated, they are taken for a ride by the institutions. Hippocratic oath doesn’t prevent many of the doctors from prescribing needless medication and treatments! Better governance, ensuring citizen rights, citizen scores for preferential treatment, better tracking and settlement of refugees and immigrants — the list of uses that the government can come up is virtually endless.Amaravati, the capital of the state of Telangana in India has already started using blockchain for land barter and register — more than 30,000 landowners have transacted using blockchain. No document writers, no double-registration and no duplicates — remarks a happy land officer!
Smart contracts that have built-in rules that get activated with conditions getting passed or failed are certainly a useful feature to ensure ownership and to trigger the appropriate action at the right time. So many times we have heard of properties being forcibly taken over because either the proper documents were not ‘found’ or the legal heirs did not turn up in time, leading to protracted court cases. If the records were digitised and appropriate rules built in the chain, then any scam or change in title deeds would be next to impossible to commit. Forcible takeover or having to settle for less at the hands of unscrupulous moneylenders will also be reduced as the original value of the property will be captured and appropriate triggers can prevent injustice!
The list is endless, and we will be uncovering more and more uses as the platform matures.
Exciting times ahead for Digital Transformations!
I will meet you soon with the next post in this series that will talk about the challenges and impact.