Blockchain is a young technology shrouded in myths. Because it’s complex, people often attribute unusual characteristics to the blockchain that give it a false reputation.
Due to the prevalence of these myths, many companies and government authorities are in no hurry to start using blockchain. That's why it's crucial to carefully study the facts and not let myths overtake reality. When building the advanced businesses of tomorrow, it’s vital to seize every opportunity to use advanced technologies that offer competitive advantages. To that end, here are five common misconceptions about blockchain that are hindering its uptake.
Cryptocurrencies use blockchain technology, but blockchain technology isn’t just for cryptocurrencies. Blockchain technology optimizes transactions while improving the understanding of transactional activity. Without blockchain, transaction chains of all types, whether financial or supply chain-related, require processing and verification.
Blockchain technology provides solutions for business challenges in logistics and trade, copyright, the arts, medicine, and astronautics.
With the emergence of AML (Anti Money-Laundering) infrastructure, operations in cryptocurrency are becoming more and more transparent. Chainalysis and similar companies report that they have learned to understand the origin and counterparties of many transactions in Bitcoin.
A transparent model and inflation protection make cryptocurrencies attractive for large companies and investment funds. The oldest US banks, such as Morgan Stanley, Goldman Sachs, and JP Morgan, are showing interest in cryptocurrencies. The latter
is already preparing to launch the first actively managed Bitcoin fund. Goldman Sachs
will also provide an opportunity for customers to invest in cryptocurrencies.
At the same time, blockchain technology is used not only for distributed finance but also to ensure the transparency and security of data. Governments have different policies regarding cryptocurrencies. But when it comes to blockchain technology, it is legal and even used in government services. More than 80% of central banks
are either studying digital currencies or have already piloted them.
While this may be true for the Bitcoin network, Bitcoin and blockchain are not equal. There are many blockchains, and they are not connected. Many startups use custom blockchains, and many of them are concerned about energy consumption and use consensus algorithms other than Bitcoin to save resources.
Blockchain brings solutions for challenges in different industries
Many blockchain startups are concerned about energy consumption
Blockchain is a gamechanger in the management of complex processes
The chain of blocks stored and continuously grown on each full node of a blockchain network can be called a database. But the main thing in a blockchain is not a chain of blocks but software controllers – smart contracts
– that automatically process and verify data.
Network protocols guarantee that all operations are protected from falsification and attacks. So, the blockchain is a new type of data system that provides non-falsifiable storage of data and protects the transformation of this data from unauthorized interference. Blockchain is a fault- and attack-resistant business logic processor, so it’s essential to use the blockchain not as a repository but as a reliable management system. Blockchain platforms with smart contracts can implement almost any complex process.
Blockchain no longer raises eyebrows. The hype has ended
, and after years of technology development we find ourselves in a market where organizations can build global blockchain projects. According to a recent study by the IBM Institute for Business Value, 85% of CIOs and CTOs
plan to use blockchain technologies in their companies in the next three years. Blockchain has led to a paradigm shift in software solutions. Already, many projects are making positive changes in various industries.
Blockchain is a game-changer in complex processes where it was once almost impossible to provide end-to-end visibility. Blockchain projects already improve security in the food and medicine industries, verification of digital identities, corporate documentation, and vaccination certificates. It also eliminates slave labor and inequality. While some companies subscribe to blockchain myths and are sticking to outdated tools, others believe the facts and are building a transparent digital business architecture.
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