Blockchain: Do You Really Need It? This Will Help You Decide!
A lot is being said, discussed and even debated about Blockchain. The one thing that is common in all this is the fact that we need Blockchain. This technology will not only liberate us from the age old concern of security of data, but also help us improve how we automate processes, and include resources within the various aspects of businesses.
Entrepreneurs and the different businesses are closely watching over this technology that was introduced first when Bitcoin walked into our worlds. However, the main question facing us currently is whether we need Blockchain or not, and what we aim to achieve through Blockchain.
It is the right time to make the decision, as there is a huge investment involved, and we need to understand if Blockchain in 2022 is the way to go forward.
Implementing Blockchain is not going to be easy, and after all the investments we have already made into the business, this is going to be one expensive investment. Unless your business truly needs this kind of investment, you don’t need to go for it.
A lot of entrepreneurs believe that Blockchain is not for them as they have, either started out or, they are in the process of scaling and cannot afford it.
We aim to help entrepreneurs and established businesses realize why they need Blockchain and how to implement the same in your business.
The way to understand whether Blockchain is essential or useful for your business is by understanding your firm’s needs, and the opportunities Blockchain creates for you.
Before knowing if you require this technology or not, you need to understand what it is, and how it works. It is a chain of different blocks, which can be treated individually. What are blocks in this case? They are pieces of digital information that you want to pass across, for which you have created the chain.
These blocks can store information regarding transactions as well as the people participating in the different transactions. Every information is stored with a timestamp making it permanent, and impossible to manipulate or change.
There can be both private and public blockchain, and the choice entirely depends on what you aim to achieve through this technology.
You now know what Blockchain is and how it works, let’s understand how you can decide if you need to adopt this technology or not.
Blockchain is a technology that is based on shared databases. If you don’t have a database or, your company does not own a database, it does not make any sense for you to invest in the technology.
A database is any structured repository that could be relational or non-relational. The information in this database would be accessed using the technology.
Why does having a database decide whether you should invest in the technology or not. For instance, if you have some data in the database, Blockchain will prevent unnecessary modifications. These transactions will be safe and secure with Blockchain. However, if there is no record that you want to maintain, then probably investing in this technology would not be fruitful for you.
There is a lot of data being transferred from one place to another in a business, and you don’t want to lose out on important data. The security of data is very important to businesses, which is why you will find a lot of them opting out of middlemen. These middlemen are replaced by the Blockchain blocks, wherein data is not only available for view, but also kept away from manipulation.
There is a lot of trusts involved where middlemen are absent. For instance, when you are completing a transaction, and you don’t have to jump onto other people’s websites to complete the payment, you will trust the website more. That’s how Blockchain works. If you feel that having no middlemen will ensure greater trust in your work, then you should adopt Blockchain.
There is data that is connected via a chain, and there are multiple writers involved in managing and maintaining the chain. However, this is true only for some businesses. If your business has multiple people managing the transactions, then you should opt for Blockchain.
For instance, in case of banking and finance, there are multiple people involved in a particular transaction, each managing a node, and then there are several users of the particular technology. In such a case, to make sure every change is recorded and monitored, and you are able to understand how it makes a difference across the landscape, you need Blockchain, as it offers transparency. However, if there is only one person making the change, investing in this technology may not serve the purpose.
This may not seem important especially when you are planning on including technology into your business. However, if technology is adding cost, it should also add some value to your business. The main reason why Blockchain is being used is that it provides a complete view into your transactions, and helps maintain an encrypted record of the same. If anyone changes even a small data, then it can be seen across the chain. It is an immutable, distributed ledger, but the question is whether Blockchain is for all types of businesses, and does it solve all types of issues that you might be facing.
The direct peer-to-peer transactions reduce the overall cost, and make the payment and other transactions efficient. In fact, the businesses can see a certain value addition in terms of cost effectiveness, especially if the answer to the third question is a yes.
The fifth point we need to understand before opting for Blockchain is whether there is going to be interaction between the different nodes responsible for transaction. Most often the transactions happen between writers who don’t know each other, and these transactions are completely dependent on each other. In case there is dependency in the transaction, you will see that they belong to the same shared database, and the security of these transactions are important.
If the transactions are going to be independent, chances are the sources may not be trusted, in which case, you will need Blockchain to maintain security of the transactions.
Blockchain may or may not be for you but, including Blockchain to your company will always offer value in terms of data security and privacy. When incorporated along with the other technologies, you will be able to enhance the overall worth of your business data, and increase the safety of the transactions.
You need to identify the type of Blockchain you want to introduce to your business, and how you want it to be added to the business, before going ahead with the same. The type of transactions, presence of intermediaries, and interactions between transactions will help define the type of Blockchain.
With these tips, you will not only be able to identify the need for Blockchain, but also be able to add it in the best possible way to your business.
Amit Makhija is Digital Marketing Analyst cum content writer at Space-O Technologies, a blockchain smart contract solution provider. He likes to explore the latest technologies that bring revolution in the mobile app world & share his findings with a wider audience by writing articles. In his spare time, he loves traveling, photography and reading non-fiction books
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