A critical consideration for businesses today that are planning new blockchain initiatives is what the alternative technologies are available in the marketplace?
But before we venture into this paradigm and investigate further, let’s go through what actually happened when Blockchain entered the technology landscape.
From its inception as the basis for Bitcoin, blockchain technology and related solutions have dominated much of the business conversation across the world. Almost every industry has a potential interest is discovering efficiencies and innovation for their business using this much-hyped technology.
Most of the current success stories however have developed in the banking and finance technology sectors, which has led to questions of blockchain’s feasibility and significance across wider applications and opportunities it creates for mobile application development services. It essentially remains to be investigated whether other industries are going to realize real-world results and value out of the emergent technology. The suitability of blockchain’s potential in the wider business world aside, basic questions still remain about the technology that may be the cornerstone for a completely unique and unified system for global transactions.
Questions and increasing interest worldwide about blockchain is a good sign for the future of this technology. The success of the cryptocurrencies is evidence enough that the blockchain-based technologies have a permanent place on the business agenda of a growing list of industries.
It must be understood. However, that blockchain is not a solution to every problem a modern business may be facing in the ever-changing and evolving business landscape. However, the leveraging of new technologies is essential to keep pace with competitors and remain relevant. Alternatives to blockchain must therefore be on the agenda for those businesses looking to streamline their operations and get ready to integrate into the future.
How Can Blockchain Assist Businesses?
When thinking of applications for blockchain technology, the sectors that immediately come to mind are the finance and banking sectors. They appear to be the perfect fit for the technology as their businesses are centred around transparency, the integrity of records and data as well as a decentralized system.
Another function that is ripe for potential innovations in the finance sector, as well as many others, is that of payments. Efficiencies in payment systems could see safe and secure payment transactions directly between parties, and thereby not requiring an entity to oversee the transactions on behalf of the concerned parties. Obvious cost and time benefits would result in such applications and be attractive to a host of businesses.
An interesting application for blockchain solutions that exist outside the traditional finance and banking sectors is in the legal arena. Management of contracts and the resulting breaches that occur from time to time between parties in one obvious application that is gaining traction. The potential use of blockchain technologies could assist the legal profession thanks to the use of the smart contracts’ programs which developed out of blockchain technology.
These innovative programs automate the contract execution function when the conditions of the contracts are met by both parties. The step of verifying the information is eliminated by the blockchain’s technology which will not allow changes to the data stored, as the basis of the very technology. Trials over such disputes could therefore be avoided, and this could lead to potentially large time and cost savings in an already over-burdened sector.
The potential of blockchain’s many innovative and cost-saving functions could be applied to almost any area of business across a host of industries. Before discussing alternatives, some current applications and examples of successful blockchain uses are discussed below.
Applications of Blockchain in Businesses
- IT - Cloud Storage
Billions of dollars are essentially being spent by business around the world on cloud storage. Storage of data imposes additional costs and considerations for businesses. The integrity of data is paramount for many companies; however, costs are also a consideration. But new opportunities are being explored for small players and independent users to take advantage of technological innovations in this space. Users spare hard drive space could be ‘rented’ which could see new income streams for those storing data. The immense costs of such storage could therefore be significantly reduced by this innovative application and the increase of service providers. When it comes to any iOS application development company, it should deftly look at employing such services before developing a product.
Many products we all consume today are a product of multiple components, supplied by multiple companies. A disruption to any one component of the supply chain of a product can affect the final products image, business efficiency and bottom line. Blockchain solutions to supply chain communications and integrity and origin of products are currently being developed by several companies. Digital auditing and tracking at each stage of the supply chain could assist numerous industries and be integrated into countless business processes.
- Remote Payroll
Payroll fees for offshore or remote employees or consultants are often a significant expense for businesses and can affect hiring decisions. Cryptocurrency is emerging as an answer to reducing fees and streamlining payments of overseas employees. Applications of this kind could be applied across almost any sector making international electronic wage payments.
Based on blockchain technology, cryptocurrency applications are being developed to address not only the costs of international payment through intermediaries but also time delays. Transparent tracking of the movement of funds is also a feature of the payroll innovation.
- Electronic Voting
When it comes to the development of the consensus model, there is an emergence of most decentralized and efficient ones at present. Few of them leverages the power and decisions of stakeholder approval voting in order to further resolve consensus issues in quite a democratic and fairway. Also, the different network parameters, including fee schedules as well as transaction sizes, can easily be tuned through elected delegates.
- Law - Smart Contracts
As discussed earlier, ‘smart contract’ programs are an innovation in the management and execution of contracts between parties that ensures data integrity and no interference from third parties.
Basically, these automated programs see the adherence to the terms of the contract. The contracts essentially will not be able to be interfered with.
The ‘smart contracts’ system allows businesses to effectively sidestep regulations, thereby lowering the costs associated with this frequently performed function.
Also, there are few Ethereum-enabled IoT platforms, utilizing these applications to easily allow the customers to rent different products where they can gain access after both parties have agreed on the different terms of the contract. Hence, an IoT app development company certainly needs to invest smartly in developing such platforms.
Limitations of Blockchain in Businesses
The idea of data integrity to comply with privacy laws and ensure security, as well as simpler, transparent business systems, makes blockchain technology seem like a necessity for all businesses and industries. But it would be quite prudent for businesses to understand the possible limitations of blockchain and research the feasibility for their needs and circumstances. These limitations can easily affect the opportunities for any Blockchain development company.
One factor limiting the roll-out of the technology is scalability. The technology offers a safe and secure record of data; however, it has not been designed to handle the volume of potential transactions worldwide. Unlike the volumes that say a system such as Visa uses to manage large volumes of transactions, the blockchain technology as yet cannot manage this load. This is a significant problem is integrating the technology or one of its alternatives into a business and can have wide-ranging ramifications.
So despite the attraction of the idea of a secure global transaction system for payments, it may not as yet be feasible on a practical level given the technological limitations at present.
The Blockchain technology also sells itself on its record of highly encrypted data handling. Instances of breaches have been rare; however, this feature may be tested in the coming years with competitors as well as current technologies that can offer a similar feature and cost-effective options for businesses.
Given the limitations of blockchain technology, it makes sense for businesses to explore alternatives to the technology. A better outcome in terms of not just the technology but the cost and suitability may be achieved with alternatives technologies.
Top 3 Essential Blockchain Alternatives for Businesses
As discussed in this particular article, there are essentially a number of limitations on the existing blockchain technology that may limit its suitability for a particular sector or business type. Given that other companies offer products with alternative technology, it is well worth the exploration of these products to ensure the best business fit for your company. In particular, it is the small to medium businesses that may benefit from adopting a technology that suits their needs rather than is the well-known option and current trending technology.
The technologies below offer alternative solutions for business that may not be suited to or benefit from the current blockchain technology:
- Latest Cloud Storage Options
Blockchain may not be the best option when it comes to cloud storage, depending on the volumes and nature of the data. A specialist cloud storage service may not only be a better fit for reasons of the technical function, but there may be more options to choose from and therefore may be more cost-effective if the technology proves more suitable for the enterprise.
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The storage ability of blockchain technology is suited to small volumes of data, and therefore may not be the best option for larger volumes of data that continue to increase over time. Alternatively, a business may be better to choose a higher speed, higher capacity cloud storage service, which is a better technology for storage than what blockchain can currently offer.
- Centralized Databases
The specific needs of the business need to be considered here to avoid the implementation of a technological solution that does not reap the intended rewards. The decision to use blockchain to decentralize systems, therefore needs to be considered case by case by each business and their unique requirements.
Decentralizing databases and data does not make sense if all it merely achieves is a replication of the same data but across multiple devices. The function of the business and access to records and overall use of the data needs to be analyzed. A mere replication of data can slow down networks instead of leading to efficiencies in the business. The flow-on effects can impact energy consumption and scalability.
- Other Distributed Ledgers
A blockchain solution may not offer the best solution for those companies that require a distributed ledger technology. Alternatives exist in the marketplace to address issues such as security and transparency or decentralization. These technologies offer the added advantage of providing the core features of blockchain technology but without the high volume processing limitations or limitations with scaling up the business.
It would be prudent for businesses considering adopting a new system or technological solution to ensure that they analyze their specific business requirements before taking on the much talked about blockchain technology. An understanding of the technology and where it can and can’t help a particular problem will ensure benefits and efficiencies and no complications. Identifying the issue that needs to be solved is one way to avoid the implementation of a system that while maybe game-changing for some sectors, may not the perfect fit for your business. Alternatives do exist and are worth exploring before taking on a blockchain project from the outset. Mobile app development services have to adjust to the new realities and technologies emerging and adapt to deliver innovative and improved products to their customers.