Table Of Contents
- 1. How to Utilise Blockchain Technology for E-Commerce
- 2. An Introduction to the Blockchain Technology for the Beginners
- 3. The Future of Blockchain Technology
How to Utilise Blockchain Technology for E-Commerce
What is Blockchain Technology?
Blockchain is a decentralised digital public ledger for tracking economic transactions. It’s designed to record not only financial transactions but everything that goes in it. The best feature of a Blockchain is that it allows to view user’s holdings and the transactions that they have carried out over the system publicly.
Moreover, it also conceals the identity of a user via powerful cryptography. The decryption of the cryptographic code needs a long and challenging calculation, thereby, making it the safest way to transact money.
Challenges in the e-commerce Sector
Blockchain technology is transforming the ecommerce industry by decentralizing the control and cutting the existence of middleman from the landscape. But, before exploring the potential of Blockchain technology for e-commerce industry, let’s dig into the current challenges that the e-commerce industry is facing.
- High Costs- One of the major pain point of a seller in the traditional ecommerce business model is the involvement of a middleman, who takes away a good share of money on every purchase. The seller has to pay the transaction processing fee for completion of each transaction.
- Uncertain Security- Protection of buyers’ data is another key concern for these kind of businesses. The system needs to gain the trust of their customers and have to assure them that their personal and financial data is safe. The current state of the ecommerce industry fails to provide foolproof security to the users.
- Time consuming- E-commerce model include an array of operations like supply chain, logistics, payment gateways etc. To manage all these operations e-commerce industry has to deal with this intermediates everyday. This consumes a lot of time to complete the whole process.
How Blockchain will Drive the e-commerce Industry in Future
Blockchain technology for e-commerce is a boom for not only the sellers but also for the buyers. Few of the challenges which can be addresses by introducing Blockchain in e-commerce industry are as follows:
- Cost Reduction- With Blockchain, e-commerce industry can rely on the Blockchain technology for managing inventory, payment processing, product database and other business activities. This results in spending less on maintaining systems or hiring IT support teams to maintain them. Cryptocurrencies like Bitcoin, Ripple etc. will cut-down the fees that third party institutions like banks charge during transactions.
- Cyber Threats- Despite of using a secure transaction network, the e-commerce industry is always at a risk of losing their customers data and money due to unwanted cyber attacks. Blockchain technology is a perfect solution for resolving these challenges. It provides highest level of security by using distributed ledgers for managing the e-commerce database management systems.
- Fast processing- Blockchain technology for e-commerce is removing the dependency of middleman, manpower and third party organizations from the e-commerce model. It saves a lot of time consumed in the overall process ranging from inventory managing, to order placing to delivering at users door step.
These challenges have been bothering the sellers since the beginning. Thus, integrating Blockchain Technology to e-commerce sector can definitely be a good idea for the whole system. Here comes the need of Blockchain technology for e-commerce industry which is capable of resolving all the challenges alone.
Many e-commerce companies have already started investing in Blockchain technology to run their business smoothly. The day is not far when Blockchain technology will penetrate the whole e-commerce industry.
An Introduction to the Blockchain Technology for the Beginners
These days, technology is scaling newer heights of success at an unbelievably fast pace. One of the latest triumphs in this direction is the evolution of the Blockchain technology. The new technology has greatly influenced the finance sector. In fact, it was initially developed for Bitcoin – the digital currency. But now, it finds its application in a number of other things as well.
Coming across this far was probably easy. But, one is yet to know what is Blockchain?
A distributed database
Imagine an electronic spreadsheet, which is copied umpteen number of times across a computer network. Now, imagine the computer network is designed so smartly that it regularly updates the spreadsheet on its own. This is a broad overview of the Blockchain. Blockchain holds information as a shared database. Moreover, this database gets reconciled continuously.
This approach has its own benefits. It does not allow the database to be stored at any single location. The records in it possess genuine public attribute and can be verified very easily. As there’s no centralised version of the records, unauthorised users have no means to manipulate with and corrupt the data. The Blockchain distributed database is simultaneously hosted by millions of computers, making the data easily accessible to almost anyone across the virtual web.
To make the concept or the technology clearer, it is a good idea to discuss the Google Docs analogy.
Google Docs analogy for Blockchain
After the advent of the eMail, the conventional way of sharing documents is to send a Microsoft Word doc as attachment to a recipient or recipients. The recipients will take their sweet time to go through it, before they send back the revised copy. In this approach, one needs to wait till receiving the return copy to see the changes made to the document. This happens because the sender is locked out from making corrections till the recipient is done with the editing and sends the document back. Contemporary databases do not allow two owners access the same record at the same time. This is how banks maintain balances of their clients or account-holders.
In contrast to the set practice, Google docs allow both the parties to access the same document at the same time. Moreover, it also allows to view a single version of the document to both of them simultaneously. Just like a shared ledger, the Google Docs also acts as a shared document. The distributed part only becomes relevant when the sharing involves multiple users. The Blockchain technology is, in a way, an extension of this concept. However, it is important to point out here that the Blockchain is not meant to share documents. Rather, it is just an analogy, which will help to have clear-cut idea about this cutting-edge technology.
Salient Blockchain features
Blockchain stores blocks of information across the network, that are identical. By virtue of this feature:
- The data or information cannot be controlled by any single, particular entity.
- There can’t be no single failure point either.
- The data is hold in a public network, which ensures absolute transparency in the overall procedure.
- The data stored in it cannot be corrupted.
Demand for Blockchain developers
As stated earlier, Blockchain technology has a very high application in the world of finance and banking. According to the World Bank, more than US$ 430 billion money transfers were sent through it only in 2015. Thus, Blockchain developers have significant demand in the market.
The Blockchain eliminates the payoff of the middlemen in such monetary transactions. It was the invention of the GUI (Graphical User Interface), which facilitated the common man to access computers in form of desktops. Similarly, the wallet application is the most common GUI for the Blockchain technology. Users make use of the wallet to buy things they want using Bitcoin or any other cryptocurrency.
The Future of Blockchain Technology
What is Blockchain?
The term blockchain has been used in numerous social and corporate conversations in recent years and everyone seems to have heard about blockchain technology, but a majority of the population actually has no idea what it actually means.
In order for us to clearly explain what blockchain technology actually means allow us to give you a brief breakdown about the history of how the transaction of money has evolved. Historically whenever people used to exchange valuable items there were middle men whose sole purpose was to record the authenticity of both parties and build trust between them. Currently these middle men are known as banks. The use of banks and brokers has continued over time and with the emergence of digital assets like stock, electronic money, and intellectual property the need for a more secure method has emerged. This is because digital assets are usually files within a computer that are therefore vulnerable to manipulation and theft. Thus the use of the blockchain technology enables parties to transact openly and transparently ensuring that the exchange is secure and efficient.
The Future of Bitcoin
Blockchain has the ability of completely disrupting the financial industry the same way social media disrupted mainstream media or the same way Netflix destroyed Blockbuster films. Blockchain technology has the potential of being used as a platform that provides financial services to everyone on the part of the world, this includes people in developing countries who may not have the access to traditional banking services and cannot afford the rates required to make large transactions. This technology has the potential of making major breakthroughs in nearly all major industries that are usually manipulated by big corporations.
The use of Blockchain technology in Education
Blockchain technology in education can be used to figure out the students that actually need the scholarships and those who can afford it. This is because a few students have been bypassing the system and getting financing. This would actually end up being detrimental to the needy students who end up dropping out or accruing a lot of debt that causes them to work for nearly.