Explain with your own words, why these are the benefits of using a blockchain.
I want to begin by highlighting the fact that the below benefits are all interlinked with each other, complimenting each other in such a way that the benefit by itself only reaches its full potential when combined with the other benefits, giving blockchain its due credit and key sell point, in my opinion, as to why entities should at the very least investigate the adoption of blockchain within their own industries.
1. Transparency:
Transparency to me is probably the most important benefit that blockchain provides. With transparency alone, it makes it extremely difficult (if at all possible) for corruption, theft or any other criminal activity to exist, since everything being done is now publicly available, and any such actions are easily identifiable, which not only deters any such attempts, but allows for undeniable facts of such actions and those responsible for it. Through transparency alone, you will end up with a more honest and trustworthy society in the end. I am therefore of the opinion that blockchain is not only beneficial as a technology to improve any industry but will have an enormous positive impact on society. Transparency ultimately promotes accountability.
2. Security:
Due to the decentralized nature of blockchain and having all of the information spread over the entire world, without the need to duplicate the actual information itself, creates a single database or store of information, void of possible attacks on a network level, ensuring that the network remains online at all times. Adding the fact that changing historic information on the blockchain becomes an extremely difficult & unmanageable task, makes any attack to information stored on the blockchain expensive and no longer worth it, re-enforcing the security of the information stored on the blockchain. Depending on an enormous âcommunityâ instead of a single third-party entity by forcing consensus within the community before changes can be made to the information on the blockchain, in itself not only ensures for the secure storage of information, but also ensures that information stored is done so by authorized entities through means of encryption algorithms. By ensuring strict security on the network, automatically re-enforces accuracy of traceability, and transparency.
3. Improved traceability:
The ability to accurately and confidently be able to trace the composition (but not limited to) of anything in existence adds a benefit far beyond the example I will explain here. I cannot express the importance of traceability enough, since this could have resolved numerous catastrophes or pandemics that occurred in the past, in an extremely shorter space of time than was required. The ability to trace, for example, food infected with a highly contagious bacteria, eliminates the need for a time-consuming process of having investigators travelling to several different areas in order to conduct tests etc. to eventually identify the source of the problem. Not only will traceability speed up this process, but will show (without spending time having to investigate it) exactly where else this bacteria was spread to, allowing for the spread to be confined and managed much faster. This is but one example of the importance of traceability, and the benefit it provides outside of the Financial industry. To put things in perspective; âwould COVID-19 have become the out of control pandemic it currently is if it was easily traceable in every aspect?â
4. Increased efficiency and speed:
By having the means to confidently rely on the transparency & traceability aspects enforced through tight security, in itself increases efficiency & speed. Simply by having an overview of every contributing factor within a supply chain enables one to make better decisions on how to rectify or correct a problem, long before it becomes a problem, allowing for the continues and efficient operation of any industry, which in turn increases overall speed of production. Also, by allowing your information to be publicly available, and not having to depend on a third-party, gives one the ability to now make decisions, interact with the supply chain etc. from anywhere in the world, as opposed to having to waste time by informing several different third-parties about a decision, before being able to rectify a problem and having all parties involved being informed about it. The benefit that blockchain brings in this regard is endless, and unmatched by any known technology available.
5. Reduced cost:
Many areas of cost saving have already been highlighted in the above four points but is not limited to these areas alone. Adding to that; by making use of blockchain already removes the need to pay for over-priced third-party licensing fees and having the need to employ specific skills in order to maintain these third-party systems. This does in no way mean that unemployment will increase exponentially, but rather that you can now employ people to instead focus their time & effort doing research in specific fields, improving the efficiency of those fields, which will have a far greater positive impact on any industry & society in general, which indirectly reduce cost through return on investment from knowledge & expertise gained by focusing on progress, instead of maintenance. The need to invest vast amounts of money on infrastructure will also become less.
