The use of blockchain in business has been gaining momentum over the past few years, most notably in vital processes such as financial transactions, cryptocurrencies, manufacturing, supply chain management, and many others. When the pandemic emerged, however, that momentum slowed to a crawl, at least temporarily. Companies were forced to shelve technology projects as they sought to keep business operations afloat.
But there’s a silver lining: the value of blockchain was amplified during the pandemic. Not only did it illustrate how interconnected the world is, but the pandemic also revealed how fragile supply chains can become. For example, look no further than the spike in demand for personal protective equipment and testing kits at the beginning of the pandemic.
Additionally, pandemic lockdowns served to accelerate digital transformation across a range of industries. Notably, shipping companies transitioned to blockchain-based platforms and tools to better facilitate supply chain communication and transactions.
Here are some of the major blockchain trends brought forth by the pandemic:
Blockchain Trends — The Evolving Role of the Technology
In simple terms, a blockchain is an append-only transaction ledger. New information can be written onto it, but all of the previous information stored in blocks cannot be edited or adjusted in any way. Cryptography links new content to each block before it, so any changes in a previous block invalidate all the blocks after it. This serves to make appending data decentralized so no single entity controls the information, and because it’s publicly published, anyone can view and verify it.
Blockchains benefit industries that rely on supply chains in that the distributed ledger reduces operational costs by removing intermediaries and administrative efforts to keep records and reconcile transactions. Getting rid of the “middleman” makes it much easier for companies to trace products and transactions back to their origin.
During the pandemic, blockchains allowed companies to rely more on alternative digital means to track products and shipments. Not only were these alternative means reliable, but they helped to keep costs down.
Other interesting examples of blockchain trends and the value it is providing during the pandemic include:
- Support for digital passports that can prove that someone has been vaccinated for Covid-19 and their immunity status
- Improving clinical trial data management and disseminating public health data more accurately to minimize the potential for disinformation
- The potential for government stimulus money to get to recipients faster, more securely, and at a lower cost than checks and direct deposits
Blockchain Trends — Impact on Small and Midsize Enterprises
Small and midsize businesses (SMBs) have been hit hard by the pandemic, especially regarding their ability to conduct consistent business on smaller budgets and secure financing. However, another blockchain trend is their ability to help SMBs.
Deloitte reported that adopting digital ledger technology provides long-term solutions to a wide range of SMB problems because it better leverages the data collected in the SMB ecosystem. Blockchain helps companies by:
- Speeding up overseas payments by using stable coins and central bank digital currencies (digitized version of fiat currencies of central banks), shortening settlement times.
- Conducting cross-border remittance in a single day (a process that can sometimes take up to two weeks).
- Improving data transparency and lowering the risk for banks, in turn lowering the cost for SMBs to get financing and insurance coverage.
- Identifying fraud with purchase orders and invoices by accurately matching bills from logistics companies.
- Removing error correction time for transactions, so SMBs can continue doing business without worrying about liquidity, funding, or losing supplier discounts.
- Raising loan approval rates by utilizing higher quality information in credit decision-making models.
Blockchain Trends — Driving Innovation in Manufacturing
As tough as the pandemic has been on companies and individuals, it has forced them to become more innovative. Blockchains help drive that innovation, which is what has allowed companies to survive and even thrive.
Harvard Business Review featured a case study of Colonel James Allen Regenor, USAF (ret). Since 2013, Regenor had been building a blockchain-powered platform for buying and selling 3D printed parts and instructions — as well as other components that get scanned with unique identifiers — to help track them. The purpose of the platform was to create a decentralized process for manufacturing, printing, and ordering parts for things like medical devices. The role of blockchain was to ensure that design and printing instructions were tamper-proof.
When the pandemic emerged, there was a need to build vital medical devices to help battle Covid-19. After developing a global partner network, Regenor was awarded a contract by the Pentagon to convert sleep apnea machines into ventilators. Using his designs, which were streamlined by blockchain technology, converted ventilators could now be created at one-tenth the cost of new ones.
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Blockchain Adoption Will Continue to Spike
While it’s clear that blockchain has found great success in the wake of the pandemic, it remains a valuable testing ground for various industries moving forward. Technologists should stay up-to-date on blockchain trends and continue to build their blockchain skills to help their companies become more innovative and efficient in this rapidly changing world.
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