5 Benefits of Blockchain Technology for Small Businesses
Reading Time: 4 minutes Blockchain has become one of the most hyped buzzword, not only in the finance industry, but also across various industries. Through some prominent cases, it has been established that by simply adding the word “blockchain” to company’s name can send its shares skyrocketing in a single day.
CNBC states 84% of companies are tapping in on the blockchain technology. This opens up avenues of opportunities in the budding blockchain market.
With this technology so much in demand, companies don’t want to be left off of the blockchain bandwagon. So, let’s dig into what truly is Blockchain.
What is Blockchain Technology?
Blockchain technology was first introduced to circumvent conventional financial institutions and pacify the obsolescence banks feared over unregulated currency going mainstream. The blockchain technology is a distributed record book that accounts, authenticates and enforces the transactions performed. The process may seem exhaustive, but transaction creation, record, verification, and enforcement take place in real-time.
In case of small businesses, it can be used for accepting payrolls, contractual agreements, customer payments, cloud storage and more.
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This article covers real-world blockchain applications and their benefits, which you can reap for your small business.
1. PAYMENTS PROCESSING AND MONEY TRANSFERS
The most recognized blockchain application is perhaps payment transactions and money transfers. By making use of blockchain technology, small businesses can directly and securely transfer funds to remote employees present anywhere in the world at ultra-low fees. This is possible only due to nonexistence of intermediaries which normally slow down the funds transfer and charge exorbitant transaction fees. The absence of a middleman powers; cost effective and instantaneous cryptocurrency transfers and is first choice for small businesses in global marketplace.
Companies like Bitwage and Abra for instance are leading the charge in using blockchain technology to transfer funds or handle payrolls.
2. DISTRIBUTED CLOUD STORAGE
Distributed Cloud storage is another application that small businesses are taking advantage of. Blockchain-based distributed cloud storage apps like Stori and Sia permit users to rent out hard-drive space, concurrently keeping the whole kit and caboodle encrypted. Such platforms allow access to the data only if you have a special key.
Shawn Wilkinson, founder of Storj while talking to VentureBeat exclaimed, “By simply using excess hard drive space, users can store the traditional cloud 300 times over. 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 statement provides a lot of insights on how small businesses can procure benefits from distributed cloud storage.
3. ENFORCING SMART CONTRACTS
Smart contracts allow small businesses to evade financial organizations’ regulations for transactions. Smart contracts anchorage automated computer programs that have the ability to ensure terms of a contract are met. These contracts are used on the blockchain as part of the decentralized approach and are vital for small businesses, since they help diminish contractual problems and other frauds.
Also, such contracts are unbreakable and more secure than any traditional contracts and can save small businesses rampant amounts of legal fees, time and more. In the light of above, global banks are harnessing blockchain’s ‘smart contracts’ to issue microloans, further facilitating the syndicated loan market.
4. NETWORKING AND IOT
The IOT networking market is slated to top $2.48 trillion in revenue by year 2022. The hype IOT has amassed is driving an increasing number of tech companies to carve out a share from IOT market. This has resulted in blockchain business use cases, to enter the IOT landscape.
Blockchain can enable smart devices to become self-governing agents, autonomously conducting a variety of transactions. Taking this into account Samsung and IBM have teamed up for a concept called ADEPT, or Autonomous Decentralized Peer-to-Peer Telemetry, which routines blockchain “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 essentially act as public ledger without the need for a central control system. Where devices would be able to communicate with one another autonomously in order to manage software updates, bugs, or manage energy.
5. SUPPLY CHAIN & SHIPMENT TRACKING
Paperwork can stall urgent business matters. If your small business is involved in Supply-chain, shipping or logistics; blockchain technology can help you cope up with the paperwork delays. You can simply use a blockchain app like Modum to keep track of shipping deliveries in real time.
HOW CAN BLOCKCHAIN TECHNOLOGY UPSURGE YOUR SMALL BUSINESS?
Blockchain technology- the backbone of Bitcoin, is exponentially growing with vast majority of companies claiming to be “actively involved” in the technology. From secure way to track and manage data to administering contractual agreements via smart contracts, and digitally verifying your identity, blockchain technology has a lot to offer.
Incorporating blockchain technology into your business will implicate a learning curve. The charm of blockchain technology for small to medium-sized businesses is its capability of streamlining various businesses dealings which can ultimately save small businesses time and money.
There are numerous ways in which integration of blockchain technology with your business can help improve your small business growth and transactional processes. Which blockchain application can benefit your small business is an intriguing question for you to figure out.
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Co-Authored With
Author is a software engineer working as a mobile app developer at CMOLDS- a company providing iOS and Android app development services in USA, UK and worldwide. Author is principally a blockchain evangelist but also helps fintech and infotech businesses project and market their growth.
