- Blockchain technology has come across as a boon for companies and businesses.
- The growing use of this new-age technology has paved the way for greater opportunities, thereby ensuring enhanced speed, transparency, security, etc.
- By incorporating this technology, companies can bring their businesses to the next level of sales and profitability.
Blockchain technology has ushered in a new way through which many businesses are running their operations. With its rapid use, businesses of all sizes are taking advantage of the new-age technology to increase their business efficiency, as well as prevent any fraudulent activities.
Having said that, let us quickly look at some of the top advantages offered by blockchain technology for businesses.
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As transactions are encrypted end to end, blockchain technology provides greater security than any other record-keeping system across the world. Also, by anonymising personal data as well as with the use of permissions to prevent access, privacy issues can also be dealt with.
Moreover, instead of a single server, information is used stored across a network of computers, which prevents fraud and hacking.
One of the most significant advantages of blockchain technology is the transparency offered by it. Earlier, every organisation had to maintain a separate database. But now, with the application of blockchain technology, data and transactions can be stored identically at multiple locations since blockchain makes use of a distributed ledger system.
This ensures transparency as all the participants having permission access can view the same information at the same time.
Earlier processes of record-keeping and maintaining transactions required heavy paperwork and the involvement of a middlemen. By streamlining these processes with blockchain technology, businesses and users can now complete their transactions faster and with more efficiency. Also, the need for a middlemen is also removed.
Once certain specific conditions are met, transactions can automatically be triggered, which speeds up the process and enhances efficiency. Moreover, it requires less manpower, therefore negating the chances of human error.
An audit trail is created when any transaction is captured in the blockchain ledger. This not only helps in sharing the data directly with the customer, but also helps in verifying the authenticity of the transaction, thereby curtailing frauds, and enhancing security.
Curtailment of costs
With the use of blockchain technology in business operations, companies can reduce the costs associated with middlemen and third-party vendors.
Moreover, since this new-age technology ensures enhanced security and efficiency of transactions, costs pertaining to validate these transactions with traditional methods can be removed, thus ensuring greater cost efficiencies for the companies.
Another main benefit derived from the use of blockchain technology is enhanced speed and improved efficiencies. With quicker automation processes, traditional time-consuming methods marked with human error can be done away with, thereby maximising the efficiency of business operations.
Recovery of lost data
It is noted that data and transactions stored in the blockchain are contained in a large network of computers across the chain. Hence, data lost can easily be recovered.
Leveraging smart contracts
Blockchain offers businesses and companies ‘smart contracts’, which are both self-enforcing as well as self-verifying.
Hence, data recorded in these cannot be altered, modified, or manipulated. These contracts are greatly used in commercial leases, real-estate businesses, agreements with suppliers and vendors, etc.
Innovative method for capital raising
Companies can now make use of this new-age technology by raising capital through ITOs or Initial Token Offerings. These tokens are comparable to a company's equity or revenue share.
Instead of making use of traditional methods like banks, money lenders, crowdfunding sites, etc., companies can use Initial Token Offerings, which are available in exchanges where these can be traded.
This method is increasingly gaining popularity as an alternative capital-raising method for varied businesses.