Closer Look at Blockchain Technology And Its Appication in Major Industries
Blockchain Technology And Its Application in Major Industries
As blockchain technology grew all over the world, there are several industries that are implementing it in order to improve their services and products. In the last several years, the number of companies and sectors working with distributed ledger technology (DLT) has steadily grown.
However, blockchain implementation by companies is something that is planned for the long term improvement. Investments might not be recovered in a few months, but instead, in some years. Some of the most important industries implementing DLT are agriculture, finance, manufacturing, insurance and many others.
According to figures presented by Cointelegraph, by 2023, the industry is expected to grow several times. In agriculture, the current market capitalization of blockchain technology is $60.8 million dollars, with a potential growth up to $429 million dollars in five years from now. This represents an increase of seven times.
Distributed ledger technology in the agriculture market is expected to grow due to the increase in demand for supply chain transparency, according to some studies. There are some companies such as Dairy Farmers of Albert Heijn that are using blockchain technology to track specific products.
In the manufacturing industry, the numbers are also impressive. This sector is expected to grow 19 times by 2025. The market capitalization of DLT will grow from the current $30 million dollars to $566 million dollars. There are several applications in this sector, from controlling and tracking specific parts in the manufacturing chain and follow different goods produced by these companies.
On October 4, a company known as ReportLinker, informed that in the United States, blockchain technology applied to the manufacturing sector would reach the aforementioned numbers. However, the research explained that due to regulatory uncertainty in the U.S. the growth in the industry will be limited. This is something that PwC agrees with saying that blockchain will not be able to be properly integrated into the market.
On the matter, PwC blockchain head Steve Davies said:
“Businesses tell us that they don’t want to be left behind by blockchain, even if at this early stage of its development, concerns on trust and regulation remain. Blockchain by its very definition should engender trust. But in reality, companies confront trust issues at nearly every turn.”
South Korea, Japan and China are also encouraging the development of blockchain tech by promoting decentralized systems in many different economic sectors. China, for example, is one of the countries with the largest number of blockchain patents. The giant e-commerce platform JD.com is already implementing different blockchain solutions to track goods and services sold on its platform.
South Korea, instead, has recognized blockchain technology as one of the three key technologies of the Fourth Industrial Revolution including big data and artificial intelligence (AI).
The financial industry is the one that will be benefited the most by this technology. There already are several enterprises working with blockchain technology, including banks, startups and other financial institutions. By 2023, it is expected for this industry to reach an incredible $3 trillion dollars’ market, a 20 times increase compared to the $150 billion dollars that it is worth.
Nick Tomaino, founder of the cryptocurrency investment firm 1Confirmation, said that blockchain technology in the financial space could reach several trillions of dollars in valuation. It is very possible for banks to reduce costs and improve cross-border transactions that with the current system take days to settle.
Ripple (XRP), Bitcoin (BTC) and Stellar (XLM) are offering different services to financial institutions to improve their services. There are some banks that are working with BTC to send and receive funds. The same is happening with XRP and other financial companies, or even with Stellar and its cryptocurrency platform.
Other important sectors that are worth altogether less than $500 million dollars, will be growing more than 20 times and reach more than $10 billion dollars. Some of these economic sectors are insurance, energy and retail.
Researchers believe that the blockchain industry in the retail market could reach $2.339 billion dollars. This is one of the sectors with the highest potential for distributed ledger technology. It seems that the United States will be one of the leading countries in the matter.
According to a study about the future potentialities of the industry, retailers recognize that DLT is able to improve efficiency and supply chain systems. Additionally, the US government is also working in order to adopt different business applications.
“Retailers have recognized the blockchain technology’s potential for the efficiency of supply chain systems and started adopting the technology to develop business applications. Moreover, the US government is exploring the blockchain technology to boost the innovation economy,” the report says.
Blockchain is changing the world and many different industries. Companies involved in supply chain, retail, financial markets, and many others are placing their funds in this innovative technology. Furthermore, firms such as IBM, JP Morgan, JD.com, Maersk, De Beers Jewellers, and many others are just examples of some of the leaders investing in distributed ledger technology.