3 Major Industries in Which Blockchain Technology Is Changing Life As We Know It The application of Blockchain technology to health care, music and human resources is only the beginning.
Opinions expressed by Entrepreneur contributors are their own.
"Blockchain" is one of two "B" words that are all the rage lately -- the other being "Bitcoin." While Bitcoin is grabbing most of the headlines, many people are mistakenly lumping "cryptocurrency" into the same category as "Blockchain." True, the two are certainly related, but they're not one in the same.
Related: 9 Blockchain Influencers for You to Follow -- Who All Happen to Be Female
Blockchain is defined as a digitized, decentralized ledger that logs all cryptocurrency transactions. A blockchain records every digital transaction and exchange of goods, services and value -- or private data -- exactly as it occurs. To make it simple, picture a global spreadsheet running on millions of computers. Everyone can see all transactions being made, since it's a peer-to-peer system, and they're all conducted without middle men.
The main benefactors of this technology? Big banks and tech giants. And that's no surprise because we all know that big businesses drive innovation. By 2022, in fact, it's predicted (by researcher Markets and Markets) that the market for Blockchain-related products and services will reach $7.7 billion, up $242 million from last year's preduction.
These figures are helping to breathe new life into older companies like IBM. By adopting Blockchain-as-a-service (BaaS) the tech giant is investing in enterprise systems that leverage cloud infrastructure. The launch of this service in February of 2016 helped create opportunities for IBM to transition to cloud services and to use them to build custom blockchains for its customers.
Related: Just What the Heck Is Blockchain? Watch This Explainer Video.
Initially, Bockchain caused a stir, mainly within the tech sector, but it has branched out to other sectors. More and more, industries are testing out this technology in order to run a more efficient, transparent and secure system -- not to mention remaining current and competitive.
Here are how three major industries are now using Blockchain technology.
In 2014, the American Recovery and Reinvestment Act required all public, private and otherwise eligible healthcare professionals to adopt (or at least demonstrate) "meaningful use" of electronic medical records (EMR).
The Affordable Care Act (a.k.a. "Obamacare") also said that doctors and hospitals needed to implement electronic health records (EHRs) and provided $28 billion in federal stimulus money to implement these changes. Despite these efforts, no clear protocol emerged about the sharing of that data across providers.
What this means is that plenty of opportunities are out there to disrupt the system -- not just with medical records, but supply chains, smart contracts for payment distribution and more.
An example: MedRec, an MIT-backed initiative designed to be a digital family history of medical records, uses Blockchain to create for patients a family medical history that can be passed down from generation to generation. MedRec was implemented using Ethereum blockchain and uses that technology's smart contracts to execute scripts on the blockchain.
Smart contracts are "conflict-free" ways to exchange money, property and shares or anything of value via Blockchain. These contracts define the rules and penalties for each agreement and also enforce obligations automatically.
Still, in this era of rampant fraud and identity theft, how safe is this system?
For starters, MedRec doesn't store information in the way we're familiar with. Instead, metadata is encoded but still allows records to be accessed securely by patients across providers. The metadata protects the integrity of the data being requested.
This process is still in its infancy, but the federal government has taken notice. Back in September 2016, the Department of Health and Human Services (HHS) announced the winners of its "HHS Blockchain Challenge," which consisted of submissions of academic papers on Blockchain usage pertaining to health IT and health-related research.
Certainly health care is a very complicated industry, in more ways than one. But it's ripe with disruption opportunities. Blockchain might be a nifty way to revamp and simplify the industry as whole.
In the 1990s and early 2000s, music streaming took the industry by storm. Users were able to download any song they wanted, some without paying a cent. The music industry cracked down on this illegal streaming, but along the way suffered financially, leaving artists, record labels and everyone else involved feeling angry and shortchanged.
Enter Imogene Heap. She's a British songwriter and musician and the founder of Myceria, a "collective of creatives, professionals and lovers of music." The group's mission is to "empower a fair, sustainable and vibrant music industry ecosystem involving all online music interaction services."
Myceria's Blockchain-based platform has created a way for musicians to push smart contracts for the sharing of free-trade music, ensuring that profits go back to the artists. These contracts allow artists to sell directly to consumers without the need for labels, lawyers or accountants; and royalties are paid out automatically.
Another company, SingularDTV, a Blockchain-based entertainment studio, is looking to lay the foundation for a decentralized entertainment industry. By developing an entertainment-app ecosystem on Ethereum, the studio's hope is to empower artists and help rewrite the rules of the music and creative industries here in the United States.
Hip hop and electronic artist Gramatik was the first musician to sign on to the tokenization program. Having such a system, Gramatik says, whereby artists can create music on their own terms, without bureaucracy "getting in the way," is why he decided to join this platform.
As entrepreneurs, we can identify with wanting to do our own thing without interference from corporate (or industry) politics.
HR professionals spend a great deal of time verifying the potential employees' identities, backgrounds and employment histories. According to this infographic, HR professionals spend the majority of their time performing three tasks: meetings with senior staff and business partners (22 percent), employee relations and engagement (15 percent) and meetings with employees (14 percent).
These efforts take more time than low-priority tasks, like on-boarding new employees and carrying out personnel management; and are only one reason Blockchain can help revolutionize the music ndustry.
It can also help simplify payroll, certification and digital-process management.
As businesses continue to expand globally, they're finding it more expensive to send payrolls overseas. Paying people abroad can also take longer to process, due to third parties and banks with different sets of rules. What Blockchain can do is simplify the process and eliminate these middle men, making investment in the technology attractive.
Consider the example of San Francisco-based company, Bitwage. Bitwage operates on a Blockchain-based payroll system to facilitate cross-border payments through Bitcoin. This allows the company to pay employees, contractors, even vendors, worldwide in their preferred currencies. In fact Blockchain can handle the required conversion from bitcoins to whatever the local currency may be.
Finally, human resources and hiring managers spend a lot of time verifying the information of potential candidates -- from job histories, to references, to background checks. A survey by Careerbuilder showed that 58 percent of employers surveyed had caught a lie on a resume. Another report, by HireRight,showed that 86 percent of employers surveyed had uncovered lies or misrepresentations on resumes.
Alternately, using blockchain technology could increase transparency and make it easier to spot fraud in employee credentials.
Related: 8 Benefits of Blockchain to Industries Beyond Cryptocurrency
So, get ready: Whatever your industry is, Blockchain will likely have a role to play, if it doesn't already. Learn as much as you can about the technology, embrace itschanges and learn to play with the big dogs (even if you yourself are not a big dog . . . yet).