Most people associate blockchain as the technology behind bitcoin. Blockchain, however, goes beyond currency. The future of this disruptive technology will depend largely on the practical applications beyond the virtual currency. Blockchain already provides solutions to different non-financial sectors including luxury, real estate and art.
In the field of finance, Blockchain is being applied to the exchange of products such as gold and currency. An example of which is Ripple, a platform for currency exchange and cross-border payments in which Banco Santander has invested $4 million in. This application allows financial entities to make a direct transaction to each other, without the need for a central or clearing bank, thus reducing their operational costs supporting new products and service offerings for their clients.
One of the most striking examples of the use of this record shared technology is how it can be applied to the tracking and certification diamond industry. In 2006, the movie “Blood Diamonds” and the recent Oscar winner Leonardo DiCaprio brought up the issue of the existence of diamonds mined in war zones that are used to finance rebel movements. Years later, blockchain is being used to fight this problem by tracking the diamonds from the mine to the final consumer. The diamond certificate is recorded in ledgers and allows insurance companies, owners and police to cross-reference the information if needed. In this specific case, blockchain is solving several problems in the insurance industry: Firstly, saving insurers large sums of money every year, and secondly, its ability to clearly identify both the diamond and insurance fraud.
Like diamonds, real estate has also found the benefits of blockchain technology. In some countries, real estate fraud is prevalent. Honduras, for example, is planning to use the disruptive technology to build a permanent and secure property ownership recording system that will help reducing cost, fraud, errors, and as well as help speeding up transactions.
In the art world, An artist will be able to publish his pieces using a specific license and convert the usage rights into a legal and tradable virtual asset. These actions will preserve the attributes of digital art and will produce scarcity, essential for the value of the piece in the market.
Other industries that are already benefiting from the decentralized trustable database are hardware and software companies, DNA encoders, retailers, import/export companies.
Blockchain goes beyond the financial services industry, and is being utilized by many companies and industries today that face challenges in data management and security.
Guillermo Torres participated in the MIT Sloan CIO Symposium 2017 in Boston.