How the world will change with blockchain technology

In 2016, $550 million was invested in blockchain-related startups. More recently, giants such as IBM, Bosch, and Alibaba have announced their intention to use distributed ledger technology, and Visa representatives have acknowledged that blockchain will play a huge role in global finance.

Among the investors of blockchain startups are reputable venture capitalists such as Marc Andreessen and Fred Wilson. The technology has already been called the “Internet for money.” Canadian scientist and author of the book “The Blockchain Revolution” Don Tapscott believes that blockchain will completely change the financial sector in the same way that the Internet changed people's lives.

Last year, the head of Sberbank, Herman Gref, noted that blockchain “will turn over all industries - from agriculture to banks.” In many areas, blockchain will be able to replace intermediaries, as participants will carry out transactions directly with each other. According to forecasts by the consulting company McKinsey, thanks to blockchain, financial institutions around the world will be able to save about $110 billion over the next three years.

The most important thing is that, starting last year, blockchain has ceased to be just a newfangled hobby of cryptocurrency fans. Distributed ledger technology has come to the "big" economy.

Banks

The largest financial institutions are studying blockchain to integrate the technology into their systems and reduce costs.

According to the Bank of England, issuing its own cryptocurrency will allow the UK to increase GDP by 3% due to the fact that they will not need intermediaries. Investment bank Goldman Sachs has invested $50 million in Circle, a company that introduced the use of bitcoins for consumer payments. The Commonwealth Bank of Australia has partnered with the developer of the open internet protocol Ripple to create a blockchain-based system for payments between bank branches.

Sberbank recently announced that it will launch a blockchain-based electronic document management system this year. And the head of the bank, German Gref, said that blockchain will begin to be widely used in Russia in two years.

There are now hundreds of projects based on blockchain technology. For example, the Bitcoin options exchange Coinut helps to earn money by hedging risks in rising and falling markets. Last year, Visa, together with blockchain startup Chain, announced the launch of a B2B payment service.

Connect. The system should provide greater security of payments and at the same time transparency, as the parties involved will see all information about the transactions.

Virtual notary

The notary function is one of the most interesting opportunities opened up by the blockchain. The Stampery electronic notary allows you to record data in a distributed protocol. Such a record proves that the transaction was concluded at a certain time between specific counterparties.

Blockchain is changing the way property is registered in registries. Last year, one of the largest players in the blockchain technology market, BitFury, launched a project to register land rights in Georgia. According to the head of BitFury Valery Vavilov, the blockchain allows you to ensure data security so that it is not lost or corrupted. With its help, you can achieve the effect of real-time verification in the audit process and check the registry not once a year, but every 10 minutes. Plus, blockchain reduces the likelihood of disputes and reduces the cost of the property registration process, because in the near future these operations can be carried out using a smartphone.

The Swedish government also reported that it is testing a system for registering and accounting for land rights based on blockchain.

Copyright protection

Last year, the Steemit platform was launched, which pays authors for publishing texts. According to the creators, after a month of operation, the project's attendance increased 16 times. According to the founders, each of the authors of the most popular records on the platform earned about $8,500.

The Ujo Music platform is a decentralized database of copyright holders and allows you to pay royalties to musicians directly using smart contracts. Another project, Stem, attracted $4.5 million in investments. Authors upload their music and videos to YouTube, Spotify, Apple Music, Soundcloud and use the system to receive royalties through smart contracts.

British singer Imogen Heap began to place her music via blockchain on the Mylencia platform. According to her, this allows her to set her own price per track and control the rules for distributing music instead of services like iTunes and Spotify.

The company Ascribe helps artists and other creative people confirm their authorship using blockchain. The platform allows you to create a digital unique ID and a digital certificate of authenticity.

Blockchain instead of a passport

Airline software developer SITA is working on the possibility of confirming the identity of a passenger when crossing borders based on blockchain technology. If special codes are created for smartphones that will open access to encrypted passenger data, identification will only require taking a photo of the traveler's face and scanning the code on their mobile device.

ShoCard, Guardtime and other companies also use distributed ledger technology to determine identity. Users can control who has access to their personal information. A unique ID generated by a particular platform can be used as a digital signature that will be linked to any of your online transactions.

Distributed energy

The Australian company Power Ledger and many other companies in different countries are testing technology that allows homeowners who have their own power sources (solar panels, as a rule) to trade electricity without intermediaries. Thanks to the transparency of the blockchain, the seller and buyer can track the movement of electricity in the same way as the movement of money. There are already known cases when the owner of solar panels sold part of the renewable energy to his neighbor.

Fighting counterfeiting

The company Block Verify has raised $53 million from venture investors and is fighting counterfeiting in various areas: from handbags to medicines. Another company, EverLedger, helps control the circulation of diamonds. The immutable register helps identify stones and verify transactions between market participants - sellers and buyers, as well as insurance companies and those who challenge ownership. Each diamond has a unique digital passport, which is stored in the system.

Last year, the consulting company Accenture proposed tracking medicines using time stamps recorded by the blockchain. The system shows when and where the medicine was produced. This is intended to help eliminate illegal drugs and help track prescription compliance.

Internet of Things

Last summer, Chronicled launched an open registry for the Internet of Things that stores identifiers for existing objects. According to Daniel Cooley, vice president of the Internet of Things at Silicon Labs, “one of the main factors holding back the growth of the IoT market is the lack of interoperability between different types of devices. Now chip buyers have the opportunity to register and confirm their identity on a public blockchain.

Cisco, Bosch, Foxconn and other companies have created a consortium that will address the issues of using blockchain technology to increase security and improve Internet of Things products. The participants plan to develop a distributed database and a protocol for exchanging information between IoT devices based on blockchain.

Regulators have turned their face to blockchain

The main obstacle preventing the spread of blockchain technology is the lack of a legal framework. However, the first breakthroughs in the “blockchain blockade” occurred back in 2015. Then, the state-supported Estonian projects e-Residency and Bitnation, which allow obtaining electronic citizenship of Estonia, announced the launch of the Public Notary blockchain service. This is a remote electronic notary that allows a foreigner to certify documents from anywhere in the world. After that, he receives the electronic status of a resident of the Baltic country.

Later, the European Parliament Research Center published a document describing how the technology can be applied to elections. In Denmark, blockchain is already being used for intra-party voting.

The Singapore government is also actively initiating projects to study cryptocurrencies and blockchain. Recently, IBM announced that it is opening a Blockchain Technology Innovation Center in partnership with the Singapore government.

Last year, one of the largest bitcoin exchanges, Bitstamp, received its first European license. The company signed agreements with the Luxembourg government, as a result of which it was able to officially launch its services in 28 European Union countries.

In January, the US Department of Homeland Security began using blockchain to protect, transfer, and store data collected by video surveillance cameras and control sensors. DARPA is also testing the technology. In September, the Pentagon research agency signed a $2 million contract with the software company Galois, which is working on blockchain security.

Outlook

Experts predict that this year more blockchain startups will raise funds through ICO (Initial Coin Offering - an analogue of IPO - the process of issuing tokens by a company that serve as an analogue of shares on a cryptocurrency exchange). Thus, projects will receive funding for the development of new technologies.

Financial institutions will more actively integrate blockchain into their processes. The Bit-News edition quotes Microsoft strategic technology expert Konstantin Goldstein, who noted that "in the near future we will be able to observe not only the massive growth of blockchain solutions and services, but also the integration of this technology into the business processes of banks. This will be facilitated by a wide range of universal blockchain platforms and cloud tools that are already available today." One way or another, in 2017, there will undoubtedly be even more projects with blockchain technology in the world, which will gradually penetrate all industries.

Source: Hightech

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