4 Ways Blockchain Is Shaking Things Up And Why You Can’t Afford To Miss OutMiCamp Solutions
Blockchain technology is set to revolutionize the banking industry, speeding up payments and shoring up security. But what is blockchain, and how is it going to accomplish these goals? And how does it stack up to other disruptive technologies?
What Are Disruptive Technologies?
If a new technology is really going to shake things up, it has to do more than simply improve on an existing process. Truly disruptive technology fundamentally alters the way things are done and change the way people live their lives, like:
- The Printing Press
Invented by Johannes Gutenberg in 1439, the printing press would eventually lead to the creation of paper money, which is much cheaper to produce than metal coins.
Brought into the mainstream by Henry Ford, the affordable automobile industry reduced reliance on horses, which were expensive to keep and contributed to sanitation issues in urban environments.
Engineered by the Wright Brothers, the world’s first successful airplane took flight in 1903 near Kitty Hawk, North Carolina. Leonardo da Vinci drew a concept for the helicopter centuries before the first airplane took to the skies, but the technology of the time did not allow him to create a functioning prototype.
- Personal Computers
Made widely accessible by IBM, Apple, and Microsoft, the personal computer revolutionized business and allowed for exponential leaps in efficiency.
What Is Blockchain And Why Is It Disruptive?
Blockchain is essentially a digital ledger. It maintains a record of all transactions that occur in an encrypted database. At the same time, it distributes those records across a network of computers.
Imagine you own a brick and mortar store, and you want to create a website and accept payments online. But that isn’t without its risks – fraud has been moving from in-person transactions to online payments in recent years. Blockchain opens the payment process up, enabling both merchant and customer to see transaction history. This increases transparency and makes managing online payments easier and cheaper, making blockchain a disruptive technology for several reasons.
- It’s decentralized, meaning no one person or company owns it.
- It allows for the creation of smart contracts. The smart contract was first proposed in 1994 by legal scholar Nick Szabo. Szabo proposed that people could use the decentralized ledger technology to create self-executing contracts, otherwise known as blockchain contracts. This allows contracts to be stored in computer code format and to be supervised by the network itself. The network can then police itself, which minimizes dependence on third parties.
- It has the potential to be more secure, faster, and cheaper than existing systems.
What Are The Concrete Benefits?
- A Truly Global Marketplace
With a decentralized money management system, blockchain can allow anyone using its encrypted database to send and receive money. This will be a boon to multinational companies who have to deal with different currencies, but it will also help small businesses. Small businesses that want to branch out today may find it difficult to compete in the multinational space, but blockchain technology will help them scale up faster than ever before.
- Minimal Transaction Fees
Some governments have decided they won’t levy additional taxes on digital payments, and blockchain technology will also allow businesses to cut out middlemen who facilitate transactions in exchange for a fee. That’s not to say there won’t be any transaction fees, but both costs should go down.
- Faster Payments
When consumers send payments to other entities, the money first must travel to a financial institution for legal purposes. But with blockchain, your customers can send money directly. What’s more, the process is automated by the algorithm powering the blockchain, and it’s lightning fast.
- More Secure Payments
The principle of blockchain is open-to-all access that offers true transparency. This may lead some to conclude that it isn’t secure – which isn’t the case.As the name implies, the blockchain is composed of “blocks” that form a chain. These blocks contain records of transactions. It’s difficult for a bad actor to tamper with these records because they are distributed to many computers. Tampering with one block won’t do much because the network can check the integrity of said block at any time.
It does this through a self-regulating process of checking each block against the many different versions that exist throughout the network. A discrepancy can be eliminated.
Blockchain is poised to disrupt the banking industry in the next few decades. The end result could be a world in which secure payments are made almost instantly – a world where businesses and consumers can complete transactions with few or no middlemen. This will lower costs all around and increase transparency. At MiCamp Solutions, we’re always working to bring our merchants the latest in payments innovation. Whether it’s blockchain, digital currencies, EMV, or Apple Pay, we have you covered.