Intelligent And Sophisticated Blockchain Solutions

Blockchain Solutions: Blockchain is the ledger on which financial transactions involving virtual currencies are recorded. This concept, called blockchain, is related to financial operations.

However, this technology has also expanded to several other areas, covering them entirely. To be objective, it can be understood as an encrypted and decentralized database.

Blockchain means “chain of blocks.” The information within the network is validated by the users and recorded in these blocks.

When creating a block, its “identity” must be encrypted. The identity, known as the hash, considers the previous block’s hash. Therefore, it is understood that the blocks are connected, forming a chain. Furthermore, the encrypted connection between blocks ensures security within the blockchain network, preventing third-party breaches.

Knowing blockchain works, we can move on in the article to see how such technology impacts business. But before you continue reading the text, check out our Essential Fundamentals for Blockchain course. It is an excellent opportunity to learn more about the applications and operation of this peer-to-peer network. Don’t miss out!

Blockchain technology is considered a revolution, as it challenges paradigms in processes related to financial transactions, information and documents, data storage, and asset movement, allowing us to decentralize long-term monopolies in some sectors.

Traditional Business Model

The term ” Business model ” relates to how a company structures itself to generate value and revenue. Each company can use a business model that best suits its purpose. It is said that companies that do not use blockchain technology operate with a “traditional business model.”

The traditional business model is based on providing goods or services in exchange for currency. It is clear to realize that there are two characters when we talk about a commercial operation: the customer and the supplier.

However, there is a 3rd character behind this relationship between customer and supplier: the “financial institution,” which can be a physical bank, digital bank, or credit card company.

These institutions carry out and record financial operations and play a vital role within traditional models. See the figure below:

The use of blockchain promises to change the customer-supplier relationship, making it more direct and without the need for intermediary institutions. Want to know how a blockchain business model works? Check the topic below.

Blockchain Business Model

First, you need to understand the concept of tokens. A token is an asset, an entity, that has value to the company. Do you know the casino chips? They are like tokens. They have value within the establishment and are used as a bargaining chip.

Second, with decentralization, financial institutions’ authority by having a monopoly on data and services diminishes.

Blockchain attracts users by promising more security, trust, and other benefits in financial transactions. The entry of users into the network is essential to increase the reliability and, consequently, the profitability of a company with a blockchain business model. One of the most common models is when the company creates its tokens (the most famous are “digital currencies” like bitcoin) and offers them on the market for investors. This entry of tickets into the market is known as an ICO (initial coin offering).

Investors acquire tokens, the company gains resources to develop the business, and customers enter the network and start using the ticket. At a certain point in value, it rises and generates profits for the company and investors.

Companies That Are Applying Blockchain Solutions

You’ve just seen some generic blockchain solutions. See now companies and products that are applying blockchain:

Beer Vending Machine

The company Civic uses blockchain as a digital identification of users. Information from identity cards, birth certificates, and other documents can be registered on the network to ensure security and prevent fraud such as theft or identity forgery.

Secure Identity

Civic is not the only company applying blockchain for identity registration. Secure Key Tech created Verified. me, a platform the Canadian National Bank uses to register its customers’ identity and personal documents.

Azure Workbench

If you want to create an application that uses blockchain technology, you can use the Azure Blockchain Workbench, Microsoft’s platform, to help develop blockchain-based applications (DAPPs).

Also Read: The Relationship Between Smart Contracts And Blockchain

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