When Satoshi Nakamoto published the Bitcoin white paper in 2008, little did the world know that the blockchain, the technology underlying the cryptocurrency, would change everything forever. The blockchain, simply put, is a distributed ledger that stores information (such as financial transaction data) in a transparent, tamper-proof, and secure manner. The blockchain knocked on the door and entered into our lives with a bang. Make no mistake, it’s here to stay.
However, how does the blockchain benefit small businesses and start-ups or even freelancers and professionals?
One of the most significant uses of the blockchain for businesses is in revolutionizing the payments processes. The technology allows easy transfer of funds in a near instant. Payroll, for instance, can be handled with simplicity without having to deal with multiple intermediary and banking agencies and losing hefty transaction fees. Everything is done with complete transparency leaving no room for doubt.
It’s all about Data
One of the most significant assets for any organization, big or small, is data. While industry behemoths have easy access to data, small businesses might face problems with data acquisition. On the other hand, the trustworthiness of the information that is available is also questionable.
The blockchain is trustless, meaning there’s no need for businesses to trust any agency to validate data which is secured on the decentralized ledger.
The Power of Smart Contracts
Smart contracts are self-executing pieces of code running atop the blockchain. As soon as the conditions stated in the contract are fulfilled, the smart contract will execute and implement the requisite tasks stated in the agreement, say, the transfer of funds from one of the parties to the other. This is ideal for businesses (and professionals) looking out for secure frameworks such as escrow services.
The blockchain creates a secure and transparent environment for small businesses to simplify operations. From data security and validation to payments processing and smart contract-based applications, the blockchain removes intermediaries out of the equation and brings back power and control where it truly belongs.