Blockchain technology is rapidly being adopted across a wide range of industries, being used by the likes of Spotify (to build a decentralized music rights database), Unilever (to streamline its ad-buying experience), Accenture (to improve the customs clearance process for frequent international travelers). LVMH has adopted Ethereum to stop the proliferation of counterfeit goods and enhance supply-chain-management.
The underlying flexibility of blockchain technology allows it to be adapted for just about any use that requires the protection and attestation of information says Eran Eyal, the founder and CEO of blockchain personalized shopping platform Shopin, which won best ICO at the North American Bitcoin Conference in 2018.
Most importantly, that information is far more protected from being compromised than it would be if it were contained in a single centralized location, which is one of the greatest strengths of decentralization.
The act of storing great value in a single centralized repository has been the bane of dozens of hacked companies like Yahoo or Experian. Decentralized solutions achieve enhanced security through blockchain implementations and distributed networks. There is no single source of storage, rather the focus is on self-sovereignty for the end-user. There is no sense in attempting to hack thousands or millions of users each separately. The squeeze is not worth the juice.
Each transaction or data point is cryptographically stored on the blockchain, and connected to both past and future data points, which all serve to validate each other. Tampering with one of those blocks is impossible without concurrently doing the same to every other block that’s connected to it. Overseeing all of this is a collection of peer-to-peer networks that work in tandem to verify and validate the continuing authenticity of each block.
That’s not to say the blockchain is impervious to being hacked, however. If an attacker can gain control of 51% of the chain’s mining power, it can brute force a transaction into the ledger. Smaller blockchains are more susceptible to these attacks, but even larger networks like Ethereum Classic have been compromised.
Shopin’s upcoming ShopChain, requires 2/3rd control in order to be hacked, and its solution is designed to ensure that 21 or more nodes in the network are run by significant enterprise companies. This results in greater trust as well, since significant enterprise companies have no desire to be involved collaboratively in illicit activities such as this.
Additional Benefits of Decentralization
According to Eran Eyal, another of blockchain’s biggest benefits is that it reduces the costs frequently associated with needing a centralized third party to manage and control data, or to facilitate transactions. Having miniscule transaction fees helped propel blockchain-powered cryptocurrencies like Bitcoin into mainstream prominence.
Instead, the blockchain can directly connect suppliers with distributors, and customers with companies. Shopin is attempting to do just that by connecting online consumers with advertisers through its blockchain, giving consumers greater control over their personal data and financial rewards for sharing it, rather than the spoils going to third party services like Amazon.
Smart contracts can also be implemented into the blockchain, binding users together with self-executing contracts that either close the deal automatically after the terms have been satisfied or trigger the appropriate concessions should the contract need to be canceled.
Such smart contracts can greatly reduce the financial burden of safely working with other parties, removing the need for costly lawyers and middlemen. By cutting out third parties, the blockchain also facilitates much greater speed in processing transactions and accessing records.
Another huge blockchain benefit for customer-facing companies is the ability to build robust and reliable databases of customer information. Each blockchain transaction is stored under that customer’s unique ID, allowing the company to interact with this data set, and anticipate consumer behavior and making their marketing efforts more productive.
That is a major goal of the Shopin’s Retail Intelligence Data Engine and ShopScore platform, which leverages powerful AI tools in conjunction with its blockchain to provide online retailers with dynamic marketing insights that boost conversions. The blockchain itself is also ideally suited to marketing efforts, allowing for traffic verification and more precise measurements of a campaign’s success.
Eran Eyal concludes that thanks to enhanced security, crystal clear transparency, lower costs, and no centralized authorities, it’s no wonder the blockchain is forever changing how the world does business.
