Transactions that could benefit from costless verification
We are constantly verifying everything in life, and life can be seen as a circle of verification. Verification takes many forms, whether news, trending issues, or products (Lopez, 2021). Everyone wants to get the most authentic information from a reliable source. Verification takes effort as a resource and can sometimes be expensive to carry out. Blockchain technology aims to solve this problem by storing various data attributes and making them available for use in real-time at no cost. Blockchain can also be referred to as distributed ledger technology. According to MIT define costless verification as “recorded attributes that need to be verified securely on a blockchain can be referred to at any point on the distributed ledger at no cost.”
One of the biggest challenges that blockchain technology faces is bridging the gap between the online and physical products in the verification process, such as smart contracts (bitcoin) and cryptocurrency and physical assets such as Gold and real estate. The last milestone that will make blockchain complete and stand out is merging physical data and online data; this will help reduce the market power/middleman by allowing individuals and organizations to transact. This is possible because the trust of the intermediary is placed in the underlying code of conduct.
Blockchain has various components that would help bridge the gap between online data and physical products through the innovation method used by the intermediaries. Tokenisation and verifying of food provenance are well established.
Verifying food provenance – is a well-established blockchain component that will be used for storing and verifying data associated with the status of food along the supply chain. For instance, from a plant to a supermarket is easy. The main challenge would be how to prove the accuracy of data collected and the cost-effective method by which this can be achieved.
Tokenisation – this is another prominent use case application of blockchain technology. Tokenization involves digitizing physical asset form and improving the liquidity of the component trading. Tokenization involves creating tokes on the physical asset being traded. By so doing, blockchain can securitize the physical asset to the digital world. Tokenization help in buying and selling physical object in the stock market by providing valuable information concerning their value in real-time. For example, Royal Mint Gold is a uk based Blockchain platform specializing in trading GoldGold. Through the platform, IRMG represents 1g of GoldGold of the real GoldGold.
Blockchain aims to provide necessary trading information from across multiple fields at a relatively low price through blockchain technology such as trace and trace technology to reduce the end cost and increase their profit margin by reducing the length of the supply chain (Radocchia, 2021). The intermediaries involved in shifting stock from the manufacturer to the customer at a relatively low cost will reduce the number of intermediaries. Trace and trace technology has been effectively utilized by electric vehicle companies such as BMW IBM, with most Americans projected to buy electric vehicles by 2030. Blockchain technology will increase customer interest by providing valuable information about the investments.
However, implementing the blockchain online and offline integration has been copped with multiple challenges, including the authorization and authentication of the settlement and reconciliation of the invoices. Human errors are another challenge that has risked the last blockchain milestone as a peer-to-peer data feeding place (“Blockchain Issues | #2: Human Error Breeds Catastrophe”, 2021). Humans are prone to error, leading to the circulation of wrongful information to consumers.
One of the challenges experienced by multiple industries is invoice settlement and reconciliation. Most organization, even those involved in pay-on-load service and telecommunication companies, notably experiences these challenges with millions of money being delayed or lost during the transaction. With the realization of this challenge, blockchain aims to reduce this risk to its members.
Below are proven settlement and reconciliation dispute resolution used.
1. Deployment of IBM platform across all blockchain technology
2. Quick dispute resolution mechanisms
3. Involving lower risk in dispute resolution
4. Improving relationships with value chain partners.
5. A cost-effective labor mechanism
IBM has a reliable mechanism that utilizes network chains to provide accurate data on given disputes visible by permissioned parties. The key driver is that the solution is automated enabled by smart contracts and business agreed rules.
Blockchain additionally faces massive challenges regarding the fidelity of the data. The technology is a peer such that anyone can view, record, and manipulate them. The lack of central coordination of data flow through the blockchain technology foundation drives a negative few from the public, which is a key reason why most individuals have not still joined the platform. To solve this problem introducing a distribution system with a central/standard data verification would help avoid these challenges and build more trust to potential customers. Additionally, peer to peer model of business help in avoiding information manipulation due to passing from one user to another before being received by the intended customer.
References
Blockchain Issues | #2: Human Error Breeds Catastrophe. Medium. (2021). Retrieved 14 December 2021, from https://medium.com/@Kyle.May/blockchain-issues-2-human-error-breeds-catastrophe-679948072da4.
Radocchia, S. (2021). How Blockchain Can Reduce Costs For The Shifting Electric Vehicle Landscape. Forbes. Retrieved 14 December 2021, from https://www.forbes.com/sites/samantharadocchia/2019/01/04/how-blockchain-can-reduce-costs-for-the-shifting-electric-vehicle-landscape/?sh=7211b5c0c685.
Lopez, R. (2021). Business Transaction analysis that Benefits from Costless Verification. Linkedin.com. Retrieved 14 December 2021, from https://www.linkedin.com/pulse/business-transaction-analysis-benefit-from-costless-lopez-pmp-sa.
Leave a Reply