Global commerce has come to rely on multi-billion-dollar corporations that can build feasible, one-size-fits-all blockchain solutions that address their specific needs. Check out how bitcoin technology could disrupt banking. However, this also means that these players in the game have a strategic advantage over other competitors when it comes to bringing new products to market faster, more efficiently, and at a lower cost.
A huge part of how blockchain helps companies improve efficiency depends on how much they invest in understanding the technology’s implications for their supply chain relationships. An effective way for business leaders and executives to start getting educated is by looking into Bitcoin’s history, accomplishments, and future potential as a cryptocurrency.
Recognition of bitcoin and blockchain beyond digital currency is a significant factor in assessing the potential of blockchain technology applications in supply chains. Therefore, efforts to implement blockchain technology applications in businesses must start with understanding the breakthrough nature of cryptocurrency in general and bitcoin.
Bitcoin – A new asset class:
The creation, publication, and becoming mainstream acceptance of bitcoin gave birth to a new asset class upon which entire new industries depend. However, while other cryptocurrencies have risen to take over from bitcoin, the competitive landscape could look better for most other altcoins at this point.
Blockchain technology is already being used for a wide array of value chain applications, but many others are still developing. Research carried out by several universities across the globe has found that putting blockchains into practice within traditional value chains can increase efficiency and enhance collaboration among stakeholders.
Change in the existing financial mindset:
The financial crisis has demonstrated that the way we do banking and commerce is flawed. A large part of this failure can be attributed to a lack of transparency and a poor security record that resulted in a massive loss of public trust.
Blockchain technology can restore both trust and transparency needed for healthy economic interactions across all industries globally. By improving the level of trust, blockchain has the potential to disrupt large swaths of inefficient business models.
A recent example of a blockchain application is one where the supply chain can be easily traced in real-time, thereby improving existing record-keeping systems. In addition, the blockchain is a secure, distributed, and transparent ledger of transactions. As a result, it can help businesses save millions in costs while cutting down on fraud and security issues.
Reduced costs:
The potential cost savings that come with implementing a blockchain-based solution is essential when implementing a new business process or integrating new technology into existing ones. In addition, cryptocurrency has been shown to lower transaction costs by removing intermediaries and using digital currency as a basis for exchanges. Not only does this help corporations reduce their operating expenses, but it also helps governments save on service fees. Therefore, implementing a blockchain-based solution into the supply chain ecosystem can help improve operational efficiency across all industries.
Greater transparency:
Since it leverages distributed ledger systems, blockchain can make all value chain parties aware of what happens when something is put into production, warehoused, or shipped. As a result, it could enable stakeholders to establish real-time visibility into their products and reduce the risks of illegal activities occurring at various points in the supply chain.
Blockchain technology allows firms to more easily identify against which country their products originate and when companies put them on sale. As a result, it can help prevent the adulteration of products being sold by suppliers.
Multi-organizational Participation:
One of the biggest problems with existing business models is that transparency and collaboration are only sometimes easy to achieve when engaging in cross-organizational transactions. Implementing blockchain technology into business processes can solve this by enabling all members to work together efficiently.
Blockchain technology systems provide a secure framework for members to share information about their products, inventory, and shipments in real-time without compromising privacy. It helps all parties involved have a clear view of their partners’ businesses while establishing trust among them.
Bitcoin: A haven for tech developers
Although the crypto market has been in a slump for a while now, the price of Bitcoin has been consistently on an upward trend. Therefore, it is no surprise that Bitcoin is gaining attention from IT developers and startups. A number of these entrepreneurs are interested in seeing how they can apply blockchain technology to their businesses by leveraging Bitcoin and other cryptocurrencies as base systems.
By doing so, they can improve the efficiency of supply chains while also providing better security measures to protect against cyber-attacks. As it stands, there is a growing interest among many startups and entrepreneurs in using blockchain technology in their assessments as potential solutions for their supply chain needs.
Relaxed regulations:
While the regulatory issues surrounding cryptocurrencies are still being ironed out, there is a general loosening of regulations aimed at cryptocurrency trading and investment. As a result, it can significantly benefit those looking to implement a blockchain-based solution into their supply chain operations. As regulations continue to be eased, it will become easier to start using the technology. Additionally, it makes it easy for investors to monitor all transactions occurring as well as protect them from any fraud or illegal activities that may come along with these transactions.
