Despite the hype surrounding the fluctuating prices of cryptocurrencies, their underlying technology, blockchain, is driving innovation and generating real value. According to an article published today in Forbes, there are nine blockchain startups on the Forbes Fintech 50 list for 2018 that are building infrastructure to support both cryptocurrency markets and initiatives that could impact how financial transactions are processed.
In our blog post The Key Concepts of Blockchain for Business, we introduced the key concepts of the business blockchain. And our more recent post Blockchain: 7 Areas of Disruption explored the areas where this technology can make the biggest impact. In this post, we’re exploring real-world applications of blockchain that are being developed or experimented with by real companies, today.
Blockchain is driving innovation and efficiencies everywhere—both within startups and more traditional, established companies, and in both the private and public sectors. It’s becoming widespread across many industries—from financial services and real estate to healthcare, utilities and retail. All of these markets are taking advantage of blockchain applications like Digital Ledger Technology (DLT) and smart contracts.
Given that a recently released report by Accenture claims DLT could reduce infrastructure costs for most of the largest investment banks by an average of 30 percent (translating to $8 billion to $12 billion in annual cost savings) it makes sense that financial institutions are interested in blockchain. The Bank of England is investigating DLT to improve the speed and efficiency of the UK settlements system—and also save tens of billions of dollars in the process.
The accounting industry is also interested in DLT because it eliminates massive amounts of record keeping. Angus Champion de Crespigny, blockchain leader at Ernst & Young—one of the “Big Four” global accounting firms—says, “We’re seeing interest in using it to propagate security policies and identity access management, but it’s early days. We’re seeing more vendors producing business-specific products, which is really what’s needed.” One example is a service for finance and accounting recently released by IT services company Genpact, which uses smart contracts for orders between a customer and an organization.
The real estate sector is looking to blockchain to expedite processes as well as reduce fraud. With blockchain, they can eliminate the time of third-party verification by escrow and title companies—and also eliminate the related costs.
Blockchain digital ownership certificates, which are almost impossible to replicate, may also make false property listings and forged ownership documents a thing of the past. And products are already being developed. Ubitquity is a Software-as-a-Service (SaaS) platform for recording and tracking property by e-recording companies, title companies and municipalities.
Deloitte claims that “blockchain-based smart contracts could revolutionize commercial real estate.“ And the International Blockchain Real Estate Association (IBREA), founded 2013, already has nearly 3,000 members in 17 countries, showing that the real estate industry has many early adopters.
In the healthcare sector, blockchain has multiple implementations, including storing personal health records, supervising drugs, ensuring regulatory compliance and managing healthcare supplies.
The U.S. Department of Health and Human Services (HSS) is exploring how blockchain can be used in the area of digital health. Their competition, the Blockchain Challenge, solicited ideas on ways to manage, protect and exchange medical information with blockchain. In response, 70 white papers were received by individuals, companies and organizations.
In the public realm, power utilities are already using blockchain. In an area of Brooklyn, New York City, residents are able to sell excess power generated by rooftop solar panels to a local utility through a microgrid. The process is enabled by blockchain DLT, which records every transaction.
The microgrid was set up by Siemens Digital Grid Division, one of the world’s major telecommunications companies—and it’s a safe bet that their competitors in high tech are also investing heavily in blockchain research and implementations.
Retail companies initially jumped on the Bitcoin bandwagon but they’re now exploring other uses of the technology. One example is online retailer Overstock.com. In late 2014, the company decided to start accepting payments in Bitcoin—but they soon realized that another area of potential use was in the settlement of trades.
Overstock set up a subsidiary called t0 Inc. (tee-zero) to develop blockchain technologies for commercial use. Its distributed ledger platform for capital markets is the world’s first blockchain-based trading platform.
Blockchain uber-expert William Mougayar also mentions startup Loyyal, whose universal loyalty and rewards platform is built with blockchain’s smart contract technology.
What does this mean for your business?
Whether you’re in a startup or an established company, private industry or the public sector—and regardless of your vertical market—if you’re not looking at blockchain, you probably should be.