In case you were wondering, blockchain is getting ready to change the world. From transforming the way banks move money to changing how our medical records are handled, shared ledger technology will soon be the way most business transactions are done. With more than 50% of major corporations planning to transition to blockchain business applications in 2018, opportunities for investors and entrepreneurs are there for the taking.
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Take, for example, New York City’s Depository Trust and Clearing Corporation (DTCC). The trading settlement and clearing company facilitates over $11 trillion in transactions annually — all of which they plan to funnel through blockchain by mid 2018.
DTCC is but one of thousands of companies that intend to turn their blockchain business ideas into reality within the next year.
With echos of disruption already being heard across multiple industries, we thought it prudent to explore the blockchain business opportunities we can expect to see during the new year.
- 1 Blockchain Business Applications
- 2 1. Banking
- 3 2. Smart Contracts
- 4 3. Connected Car
- 5 4. Healthcare
- 6 5. Internet of Things (IoT)
- 7 Blockchain Business Development Opportunities
- 8 How Ignite Can Help
Blockchain Business Applications
To be fair, the following list of five industries soon to be transformed by blockchain could easily be a list of hundreds. Nevertheless, tthe five sectors we have chosen represent, perhaps, those most likely to embrace blockchain technology in the near future.
Nevermind that blockchain — the backbone of Bitcoin — was created to circumvent traditional financial institutions. Or that banks originally opposed cryptocurrency, fearing obsolescence if unregulated currency ever went mainstream. Blockchain, it seems, now has a new friend, and it is none other than the global banking system.
Financial Institutions Joining Forces
Barclays, Credit Suisse, Canadian Imperial Bank of Commerce, HSBC, MUFG and State Street have joined ranks on the Unity Settlement Coin (USC), a digital currency created by Switzerland’s UBS bank in conjunction with UK-based Clearmatics. By exploiting the benefits of blockchain technology, USC partners expect to make it faster and safer for central banks to settle transactions.
Other financial giants, such as Wall Street, are exploring their own blockchains. Which begs the question: Will a universal, worldwide blockchain shared by all financial institution emerge, or will regional systems be created to serve smaller financial sectors? Time will tell, but 2018 is sure to be the year banks try to figure it all out.
Therein lies the tremendous opportunity for blockchain development in the banking industry. Now that banks have decided that they had better stop fighting blockchain technology and start adopting it, the door is wide open for companies that can provide blockchain solutions to the financial institutions, both large and small.
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2. Smart Contracts
One of the hottest features of blockchain is its ability to facilitate smart contracts. While the fintech, banking, and legal services industries are already dabbling with automated transactions that execute based on preset conditions, a whole host of other business are clueless that they, too, could benefit from smart contracts.
By introducing manufacturing, supply chain management, and other sectors to the concept of smart contracts, developers will reap handsome rewards while helping to reshape those industries.
How can smart contracts be useful in these and other non-legal use cases? The answer becomes clear when you consider more closely what what smart contracts allow you to do.
Since smart contracts are simply blocks of code, they can be incorporated into a variety of software applications. But including them in a blockchain is best way to add security, accountability, and transparency to the process.
Smart contracts allow certain digital processes to take place only when certain conditions have been met. Let’s see how this technology could apply to the two examples we just mentioned.
Manufacturing is all about process. From receiving to incoming inspection and throughout the assembly process, every step is built upon previous steps having been completed successfully and on time. Unfortunately, departments don’t always know about problems in other areas until production is impacted.
By incorporating smart contracts into program management software applications, strict controls can be created that prevent problems from infiltrating downline processes.
For example, a smart contract that controls quality can prevent circuit boards from being released for testing until they have passed every required QC check. Whereas current manufacturing methodologies rely on human intervention to accomplish the same objective, smart contracts execute automatically. That is, until the last QC check has been entered as passed, the next downline process cannot accept the product. If workers try to scan circuit boards into the final assembly department, the system will not allow the boards to be scanned in.
Moreover, using blockchain technology, smart contracts are part of an unalterable record of the entire manufacturing process. This makes it nearly impossible for negligent workers to hide their mistakes or fudge numbers.
Supply Chain Management
Perhaps no industry can benefit from smart contracts so much as the supply chain industry. Just as with manufacturing, smart contracts automate the moving of materials based on predefined conditions. For example, a smart contract can prevent a transport company from accepting produce from a vendor that has failed to verify that their product was harvested after a certain date. Smart contracts offer nearly complete transparency to the entire supply chain, ensuring the quality, authenticity, and availability of goods.
Supply chain management has proven to be a willing market for blockchain technology. Within the next year, smart contracts will increasingly be a part of logistics platforms.
3. Connected Car
The automotive industry is proceeding steadily toward its goal to have more than 37 million connected vehicles on the world’s highways and byways within the next five years. The road to mainstream adoption of IoT vehicles will paved, in large part, by blockchain technology.
Blockchain will serve the connected car industry in many different ways, and each of them provides a golden opportunity for 3rd-party development in the year ahead. Let us look at three of those, now.
Supply Chain Management
Since the first car rolled off Henry Ford’s assembly line, manufacturers have strived to meet production quotas without interruption. Despite advances in manufacturing methodologies, maintaining a steady flow of quality components has been a long-standing challenge.
Shared ledgers offer solid solutions to the supply chain issues facing automotive companies. Tracking large amounts of data efficiently, verifying vendor identity, and facilitating conditional transactions are fundamental to supply chain management, and blockchain excels at all three.
As automakers look to streamline the manufacturing process through adoption of blockchain technology, the need for technology partners will dramatically increase. Since even giant companies such as IBM are still just breaking ground in this new market, there is plenty of room for innovation from startups and smaller development firms.
Vehicle to Vehicle (V2V), Vehicle to Infrastructure (V2i), and Vehicle to Everything (V2X) communications form the channels through which connected cars exchange data with other vehicles and IoT devices — internal and external. The safety of drivers and their passengers demands that automotive communications remain fast and secure.
Once again, blockchain provides the answers automakers need. Cloud-based shared ledger platforms are well capable of facilitating the encryption, transport, distribution, and storage of the massive amounts of data connected cars generate every minute.
Without a doubt, automaker will turn to blockchain technology as the backbone for the exchange of connected car data. Companies that can create OEM and aftermarket blockchain apps and cloud platforms will find a ready market for their wares.
Automotive Payment Gateways
Blockchain is already being used to make mobile payment processing fast and secure. Connected car provides even greater opportunities for companies that can develop in the cryptocurrency space.
As connected cars increasingly make up a share of the automarket, the number of products and services that will target automotive customers will also increase. Cybercriminals will seek to exploit every vulnerability in whatever payment systems are incorporated into connected vehicles.
Keeping vehicles safe from cyber threats has become a key focus of the auto industry and its technology partners. Along with the need for secure V2 networks is the need for security solutions that target mobile payment gateways. There are a number of approaches to the problem.
First, and most obvious, is the need to process payment transactions through existing secure channels. But there are other considerations that provide opportunities for blockchain developers: how should payment information be secured before entering backbone IoT channels, and — you won’t see this one coming — how can funds be stored within the vehicle IoT system itself?
Blockchain provides a ready and secure solution to both challenges. Imagine, if you will, a blockchain-based payment gateway within the vehicle infotainment system. A well planned solution, properly integrated into the OEM system, could be the de facto means of making any payment from within the vehicle. Whether paying for satellite radio, purchasing a vehicle app, or making the house payment, a blockchain cloud platform could easily facilitate payment processing that is quick and nearly hack-proof.
Imagine further that all payments are made using a well-accepted cryptocurrency such as Bitcoin. The platform could convert the bitcoin payments to whatever currency the recipient required. Such a platform could easily store replenishable funds for making purchase or payments — a connected car bitcoin wallet, if you will.
Creating blockchain-based in-vehicle payment solutions is not only a good idea, it will soon be a necessity.
No industry requires more data to be processed daily than the healthcare sector. From patient admittance to recording surgical results, every patient represents a torrent of data that must be kept accurate, accessible, as secure. No technology can satisfy these requirements like blockchain.
Keeping Medical Records Secure
Unlike conventional medical records databases, every entry or modification becomes a new, sequential data block within the blockchain. Whether entering new patient data, or updating a patient’s contact information, every change becomes a new record with its own date and timestamp.
The challenge — and the opportunity — lies in creating healthcare blockchains that are shared between large sectors of the medical industry. Private blockchains have their place within local or regional healthcare systems, but nationalized blockchain solutions offer the greatest benefit for patients and healthcare providers.
Since nationalized healthcare blockchains probably are probably years away, opportunities in smaller markets will abound in the near future. As local and regional healthcare organizations struggle to keep patient data secure, developers will see a willing market for the unique benefits shared ledger solutions can offer.
5. Internet of Things (IoT)
The growth of IoT technology cannot be over exaggerated. With everything from cars to connected homes hooking up, the market for technologies to support IoT is enormous. With $6 trillion expected to be invested in IoT during the next five years, an increasing number of tech companies are looking for ways to carve out a share of the market. One of the best opportunities awaits innovators who can make IoT data move more quickly and remain secure using distributed ledger technology.
Bring Your Own Chain
The great thing is, the rules have not been written on how to make it all work. Since blockchain is a data management concept, rather than a fixed methodology, there is no set standard that developers must adhere to. Of course, if your application will integrate with Bitcoin or Ethereum, you need to design to the protocols those platforms run on. Otherwise, you are free to create your own blockchain, using whatever rules and features you want to include.
Blockchain offers enough proven technology to make implementation easy, yet enough flexibility to make proprietary platforms feasible.
Whatever way you plan to go, offering shared ledger platforms to IoT stakeholders in 2018 will forge long-term and lucrative relationships for years to come.
Blockchain Business Development Opportunities
Blockchain development will be one of the hottest sectors of software innovation in 2018 and beyond. We have provided some ideas on how different industries will be impacted, but the list grows longer by the minute.
In future articles, we will discuss how blockchain will transform and disrupt industries across the board, who the players are, and how to get your piece of the market. We will also address the challenges and concerns that must be addressed in any blockchain project.
How Ignite Can Help
The market for shared ledger solutions is poised for explosive growth over the next 12 months. But capturing market share will take more than great blockchain business ideas, it will take great skill to pull it off.
Ignite offers world-class outsource development solutions for emerging markets such as blockchain. Our expertise in automotive, cloud, and Fintech technologies enable us to innovate competently across a multitude of industries. Whether your offerings involve banking, smart contracts, connected car, healthcare, or IoT, we stand ready to be your technology partner.
We invite you to contact us today for a no-cost consultation.