Cryptocurrency can take companies into previously untapped developing regions. Of course, it also can simplify commerce right here at home.
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Most of the media headlines on blockchain technology revolve around the outsized investment performance and extreme volatility of cryptocurrency. This trajectory closely resembled a roller coaster as Bitcoin gained 1,390 percent in 2017 (up as much as 1,935 percent when it hit a record high of $19,666 in mid-December) — and then plummeted to a low of $5,950 in January 2018. By mid-February, it had settled around $8,400.
The growing consensus among business leaders and entrepreneurs: The future of blockchain technology will be about a lot more than Bitcoin. Blockchain tech will impact every major area of business from accounting to operations, and there’s evidence the revolution has begun.
What is it, and why is it so crucial to the future of business? A blockchain is an electronically distributed ledger or list of entries — much like a stock ledger — that various participants maintain via a network of computers. Blockchains use cryptography to process and verify transactions on the ledger. Encryption and coding improve transparency, efficiency and trust in information-sharing.
All of this has innovative companies rethinking their strategies for the digital age. Here are five ways blockchain technology is disrupting the way we do business, with sometimes sweeping changes.
Accounting is the textbook case study for a business field that stands to benefit from blockchain technology. The tax code is overwhelmingly complex, the challenges of managing business operations in far-flung locations are many, and the need for precision and accuracy is paramount. Blockchain tech can more effectively manage all of the above.
“Blockchain’s transparency gives visibility to all transactions for approved users, and this may decrease auditors’ work with sampling and validating transactions,” Ken Tysiac wrote in a recent edition of the Journal of Accountancy. “But this allows auditors more time to focus on controls and investigating anomalies. Meanwhile, opportunities are emerging for CPAs to use blockchain technology as they expand their assurance services to areas such as cybersecurity and sustainability.”
While the Winklevoss twins and other entrepreneurs are striking it rich with cryptocurrency, a large inheritance or winning lottery ticket remains the best chance for the rest of us to become millionaires. Here, too, blockchain technology will have a role. (Never mind the chances of winning the Powerball jackpot are about one in 175.2 million.)
Blockchain technology has the potential to disrupt the $260 billion annual global lottery market by providing anonymity and confidentiality for participants and providers alike — while reducing the potential for fraud and manipulation. Prime Ball, managed by Ethereum smart contracts, will be among the first fully decentralized and transparent lottery platforms using blockchain. All winning results will be publicly recorded and distributed on the Ethereum blockchain without any third-party involvement. This new model is a major shift in an industry where scratch-off tickets and pencil-filled play slips remain commonplace.
2. Advertising and marketing.
Juniper Research anticipates advertisers will lose an estimated $19 billion to fraudulent activities next year — the equivalent of $51 million per day. This figure, which represents advertising on online and mobile devices, is projected to reach $44…