3 Industries that Will be Disrupted by Blockchain Technology

Cryptocurrency and blockchain technology are trends that have the potential to disrupt the financial world, but there are other industries that will be affected too.

Over the next few years, the blockchain model will become one of the major drivers in the field of innovation. You probably already know that blockchain forms the basis for Bitcoin and other cryptocurrencies, but did you know it can become the driver of innovations in other industries too? Before getting into that, below is a little explanation of blockchain for the uninitiated.

A blockchain is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Once recorded, the data in any given block can’t be altered retroactively without the alteration of all subsequent blocks which requires the consent of the majority of participants in that particular blockchain network.

Hence, a blockchain is inherently resistant to data modification. It can be seen as an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.

So, the two main advantages of blockchain are transparency and reliability. Let’s examine the industries where this system is making inroads, or will be soon.

The way we buy a house can be transformed by blockchain too. The bank’s handling of mortgages can become more transparent and more efficient. PwC takes this vision seriously, concluding:

“Specifically, the technology could remove cost and friction from the process, create transaction records that are infallible and incorruptible, and facilitate near-instantaneous settlement. It could also dramatically change the way mortgages are serviced and sold on the secondary market.”

So-called “smart contracts” are another exciting option of blockchain. A smart contract is a programmed contract, the agreements of which are set down in computer code using blockchain. The contract is automatically executed without the need for an intermediary. In these contracts, each transaction is recorded; it is a sort of cross between a contract and a ledger. This transparency saves a lot of time and reduces the chance of conflicts.

Last September, the real estate marketplace Propy announced the world’s first real estate transaction on the distributed, public blockchain network Ethereum. TechCrunch founder Michael Arrington remotely purchased a $60,000 apartment in Kiev which was settled via smart contracts. He paid in Ethereum cryptocurrency and Propy tokens.

Platforms such as Uber and Airbnb are the “poster children” for disruption. They are so often cited as terrific examples of innovation that, frankly, I find it a little tiresome sometimes. Ironically, blockchain has the potential to disrupt Uber and Airbnb.

In his 2016 Ted Talk, author Don Tapscott explained why: “Blockchain helps with the contract, identification, payments, and even the reputation because a room with 5 stars on blockchain exists and has been assessed, and that cannot be changed,” said the author of Blockchain Revolution. “What if, rather than Airbnb being a $25 billion corporation, there was a distributed application on a blockchain—we’ll call it “B-Airbnb”—and it was essentially owned by all of the people who have a room to rent?”

In this scenario, when someone wants to rent a room, they go onto the blockchain database, and they sift through all the criteria to find the right room. Then the blockchain helps with the contracting, it identifies the party, and it handles the payments through digital payments.

“And it even handles reputation,” Tapscott continued, “because if she rates a room as a 5-star room, that room is there, and it’s rated, and it’s immutable. So, the big, sharing-economy disruptors in Silicon Valley could be disrupted, and this would be good for prosperity.”

These words say it all: the next disruption may be just around the corner. So, to keep ahead of the curve, I advise you to follow our blog about new and inspiring topics.