Blockchain usage beyond cryptos: From money transfer to tax filing

SUMMARY

While cryptocurrencies like Bitcoin have gained popularity, thanks to the meteoric rise in prices, the significance, and scope of blockchain, the underlying technology, is yet to be fully explored.Reserve Bank of India Governor Shaktikanta Das recently pointed out that while cryptocurrencies can be a 'serious concern', the decade-old blockchain technology can grow without the currency.The Indian government, which is contemplating a ban on all private cryptocurrencies, has also noted it wants to 'promote the underlying technology of cryptocurrency and its uses'. Blockchain, a decentralised system of storing data, has multiple uses other than cryptocurrency transactions. Here are some real-world uses of blockchain technology

By CNBCTV18.comNov 26, 2021 5:44:16 PM IST (Published)

Money transfer: Transferring money between accounts using a centralised entity can take a few hours or even a few days. However, if done via blockchain, it can finish in seconds, as they do not require a central facilitator to authorise the transactions. This would be the most practical use of blockchain technology.

Taxation:The process of filing taxes can be cumbersome and prone to error. If an individual's financial information is stored on the blockchain, the process of filing taxes can be more efficient and secure.

Digital voting:Personal identification stored in blockchains can help in optimising the voting process. Securely kept voting and personal information on the blockchain can ensure no one can tamper with the integrity of the voting system. In addition, it can make voting more accessible as people could vote with their smartphones without worrying about security.

Secure medical data: The accuracy of medical data in hospitals can be a matter of life and death. Blockchain technology can store up-to-date data of the patients in a secured distributed system. It would also allow doctors to access patient records in seconds, allowing them to devote more time to patient care.

Insurance: Smart contracts on blockchains can revolutionise the insurance industry. Smart contracts make insurance claim processing extremely fast, and the claimant can receive the funds as soon as possible. The customer data stored in the blockchain would also help to squat down dubious claims made by customers.

Lending:One of the best uses of smart contracts on blockchain can be for loans. Smart contracts allow events to trigger automatically when some conditions are met. In the case of lending, these events could be repayment of a loan, collateral release, and service payment. This can make loan processing faster and less expensive.

Supply chain monitoring: In a blockchain, every transaction is a part of the public record. It can bring coherence to the supply chain of a product, from the root source to the consumer. This can bring visibility in real-time, as you can see from where the product's journey started and where it ended. It also brings accountability; manufacturers can keep a tab on the suppliers and ensure that everything is up to code.