Blockchain is the most recent way of forming a collection of data on the internet. This can be used to develop blockchain applications like a social network, messengers, games, storage platform, etc. Information on a blockchain can be of any form; it could be telling you about the transfer of money, or any transaction or even an agreement between two parties. Blockchain will continue to improve and innovate a variety of industries. Blockchain in e-commerce has options to empower consumers. Moving on to know more…
What is Blockchain Technology?
Blockchain is a series of recorded data which is managed by a cluster of computers. Every single block of this data is secured and bound to each other. It is like a democratized system because it has no central authority.
Blocks are the batches of transactions which are encoded, and each block consists of a cryptographic code that links a block to the another. Blocks that are not selected for being included in the blockchain are called Orphan Blocks.
It is referred to as the average time taken to generate an extra block. In cryptocurrency, when a transaction takes place, shorter the block time, faster the transaction.
How does it work?
- Blockchain aims at keeping a record of all data exchanges; each data exchange is called a “transaction.”
- These transactions are verified by a distributed system.
- Once the transaction is verified it cannot be altered; it is finally added to the blockchain.
There are two kinds of cryptographic keys:
- Private Key: This is more like a secret key. A private key is used for decrypting the messages. A private key is confidential to its owner. It is important to keep your private key safe and not share it with anyone. The private key is symmetrical and is faster.
- Public Key: To convert messages into an unreadable format a public key is used. Just like its name suggests, a public key is made available to the general public via an accessible repository or directory. A public key is asymmetrical. And is relatively slow to encrypt or decrypt.
Blockchain is being used in many fields these days like:
Mostly the cryptocurrencies, like bitcoin, use blockchain technology to record the transactions. Blockchain makes the transactions safe even to remote locations.
- Smart Contracts
These are the proposed contracts that could be fully or partially executed without any human interactions. It is a safe way of making sure that all terms of a certain contract are being carried out correctly. It is a very transparent way of doing business considering all parties involved are neutral and do not have emotions and thus no reason to cheat.
- Financial Services
Financial Industries these days are implementing distributed ledgers so that they can be used in banking. In time, blockchain can even remove any necessity for bank branches. Blockchain helps in clearing and settlements procedures. It can recreate trade finance for the world. It also helps in smooth cross-border payments.
- Video Games
Some of the latest video games are based on blockchain technology for example- Huntercoin that was released in February. Cryptokitties is how the blockchain is used in video games. It can be used to manage in-game currency accounts. To keep track when a player wins various rounds or stages or levels. Blockchain is reforming the gaming industry, and more and more such games are being launched in the market.
Blockchain in E-Commerce
The main contribution of blockchain in e-commerce is about transactions. It makes the transaction faster, safer and provides more features. Blockchain also helps in online sales. It keeps the data stored and secured and handles features such as product searches and selection, payment process as well as customer care. Blockchain has a lot to offer to the e-commerce industry. It has eliminated the middlemen as well as has reduced complexities to all levels.
Another fact to keep in mind is that this technology is the foundation of cryptocurrency payments which makes it all the more crucial to the e-commerce domain. Despite the fact that e-commerce has made life way easier there are still many challenges that this domain is facing. All this time, e-commerce was in search of strong back support that will address the various challenges and blockchain has risen to the occasion multiple times.
One of the major features of blockchain is that it provides a series of unchangeable data. This feature provides the customer with complete unaltered information regarding the origin, processing and various components of the products they intend to purchase.
Another big benefit it offers is the complete transparency in payments. It has made e-commerce a more reliable platform for doing business and purchasing products. It fosters the trust of the customers and considering all the transactions are recorded and cannot be edited by anyone works furthermore in garnering the trust of the buyers.
Blockchain offers high-security along with providing faster processing speed and tracking options. Blockchain lowers international e-commerce transaction stores. It certainly has advantages over the existing method of e-commerce.
One of its biggest advantages is that it is cost effective. E-commerce sellers can rely on a number of cryptocurrencies for running their business. Cryptocurrencies help in providing cheap, i.e., cost-efficient digital payment methods since there are no payment processes involved in crypto transactions. This method is efficient and cost-effective for the sellers as well as the buyers.
Blockchain has dependable data security which means it can not fall prey to weak encryptions. Even the most well-encrypted system can get hacked. To solve this problem blockchain created a decentralized ecosystem that cannot be hacked from one entry point.
Sellers adopting to the blockchain-based system are able to protect sensitive customer data better. It stops hackers from accessing the seller and buyer databases.
Blockchain has made such an important mark on the e-commerce industry that it has become a crucial entity for its survival. Having the right technology is right if you are hoping to make a future in the e-commerce industry. Blockchain help establishes customer trust, protects the important data and provides a safe and secure means of doing transactions even to remote locations.
Aditya works as a Growth Assistant at AirTract.Com. AirTract is a social platform in which people can ask questions, find answers, share knowledge and experience. He has a Bachelor’s Degree in Computer Science Engineering and has been working in the field of Digital Marketing for the past two years. He is also a voracious reader and a big sports fan.