New technologies are coming to market at an unprecedented rate, and CIOs are often faced with the daunting task of determining what’s relevant to the business – and what isn’t. Today, how a company leverages innovative technology, and how quickly, can give it a big leg up over the competition.
Blockchain, while still relatively new, is a technology that CIOs should be watching closely.
What is it?
A blockchain tracks the transactions of digital assets. It functions as a decentralised database that is managed by computers belonging to a peer-to-peer (P2P) network. Each of the computers in the distributed network maintains a copy of the ledger to prevent a single point of failure and all copies are updated and validated simultaneously. New transactions are added as encrypted blocks of data, like a timestamp.
Why should CIOs care?
While blockchain technology is best known for powering cryptocurrencies like Bitcoin, this isn’t its only application. New use cases are emerging all the time, and these extend beyond just the finance sector. Blockchain is already being used in insurance, utilities, healthcare, supply chain, and manufacturing and real estate, among others. Some of the big tech players including Microsoft, Amazon and Google offer blockchain-as-a-service, helping large organisations map out blockchain strategies.
Here are four spaces to monitor:
Blockchain tech has an inherent connection to cybersecurity. It stores information differently, making transactions easier and data more secure. If an attacker gains access to a blockchain network and data, this does not necessarily mean they can read or retrieve the information. Full encryption of the data blocks can be applied, effectively guaranteeing confidentiality (assuming the latest encryption standards are followed).
Blockchains also have no single point of failure, which decreases the likelihood of a DDoS attack disrupting normal operations. If a node is taken down, data is still accessible via other nodes within the network, since all of them maintain a full copy of the ledger.
The immutable nature of blockchain, and the fact that every computer on the network is continually verifying the information stored on it makes blockchain an excellent tool for storing big data.
Blockchains improve transparency in data analytics. Unlike previous algorithms, it rejects any input that it can’t verify and is deemed suspicious. This means that the data is clean and likely to be a lot more accurate.
Those who can access the most data and derive insights most rapidly will be the biggest winners.
There are two significant implications businesses need to be mindful of:
- Customer data will not belong to organisations. It will belong to each individual, represented as tokens on an identity blockchain. The customer of the future will grant access to others as they see fit.
- Transaction data will be viewable by anyone. Anyone can access the data relating to transactions.
Because blockchain-based technology is still relatively new, there isn’t the scale we need just yet to tap into the troves of data that we’ll see in the future. We’re probably still a few years away from realising the full benefits.
We are also likely to see blockchain-based technology make an impact on the cost of storing data. This will be a result of the disintermediation of centralised storage providers. Consequently, SaaS vendors may be pressured to lower prices as they move to decentralised storage providers.
Blockchain for IoT can transform the way business transactions are conducted by automating and encoding them, without the need to set up a complex and expensive centralised IT environment. All this will be done while preserving enterprise level privacy and security.
Blockchain for IoT can transform the way business transactions are conducted by automating and encoding them, without the need to set up a complex and expensive centralised IT environment. Click To Tweet
The marketing industry is dynamic and susceptible to change. It needs to fluidly adapt to new technologies, as well as ever-changing customer expectations.
Perhaps the most notable change will be with online advertising. Blockchain could be used to detect whether ads are being delivered and if they’re going to the right place. Impressions and click-through rates will potentially be more accurate with a blockchain.
CIOs face an ongoing challenge of staying on top of the rapidly-evolving technology landscape, while also ensuring that their company data and infrastructure remains secure. But when disruption is rife, it’s important to be aware of the very forces that are enabling it. While blockchain technology can still be considered as emerging, it is rapidly gaining momentum. No IT leader can afford to ignore it.
Content marketer, blogger, author and tech geek.