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Blockchain Applications
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Blockchain Applications

Since its inception in the year 2008, cryptocurrency and its underlying blockchain technology has spawned entirely new industries. The state-of-the-art blockchain technology appears to be finding applications in smart contracts and in many other areas. It is essential to understand that the first employment of blockchain technology was Bitcoin. Since then, many other cryptocurrencies have been using it for their token development.  Cryptocurrency tokens have been offered to the public recently through highly successful initial coin offerings (ICOs such as  MonetoFluxBunnytoken). So far, ICOs have raised more than USD1 billion for various startups and newly formed businesses around the world for the future development of their blockchain-based projects.

What is blockchain technology?

Blockchain technology is a database of all transactions, which are efficiently grouped into “blocks”, then replicated around thousands of “nodes”.

It is scale sensitive and monolithic and becomes more robust and reliable as the number of “blocks” and “nodes” continues to grow. The nodes of the blockchain are physical racks of dedicated computing devices. The nodes will operate in data centers, which are owned by so-called mining pools.

Blockchain technology represents an innovation in information distribution and registration, which effectively eliminates the need for a trusted third party to facilitate digital relationships. Every node in the network, in the case of a blockchain, comes to the same conclusion. Each network will systematically update the record independently.

blockchain technology

Transactions are broadcasted and every node in the blockchain creates its own updated version of events. For all its merits, the blockchain is not a new technology. It is a combination of the internet, private key cryptography, and a protocol governing incentivization. This combination of proven technologies results in a system for digital interactions that do not need a trusted third party.

Blockchain protocol

The protocol is well-planned and executed on an operating system that efficiently sits on top of the blockchain technology. Maintained by the cryptocurrency core development team, the protocol is open-source and free software. The blockchain protocol has the strengths of rigorous code testing, trust in the collective product, and rapid improvement cycles.

Blockchain-based cryptocurrency token

The cryptocurrency tokens built on blockchain technology are exchanged within the system and are efficiently minted by miners via the network of well-connected “nodes” that validate transactions. Miners receive pre-defined tokens as a reward for validating transactions. The token has value only because investors find value in it, just like any other medium of exchanges.

Defining digital trust

In the digital world, determining trust often boils down to proving permissions (authorization) and proving identity (authentications). Private key cryptography on the blockchain provides a powerful ownership tool, which systematically fulfils authentication requirements.

The possession of a private key means ownership in the world of blockchain technology. A private key also prevents a person from sharing more personal information than he/she would need to for a cryptocurrency exchange.

Authorization needs a peer-to-peer and distributed network as a starting point. The decentralized distributed network of the blockchain technology efficiently reduces the risk of centralized corruption or failure.

Blockchain applications and ICO

As a distributed database, the blockchain systematically maintains an ever-growing list of ordered records, known as blocks. Each block of the blockchain technology contains a link to a previous block and timestamp. It is essential to understand that the blockchain technology, by design, is resistant to any modification of data.

Once recorded in a block of the blockchain, the data cannot be altered retroactively. State-of-the-art blockchain technology-based projects or systems are secured by design. In addition, blockchain technology-based systems efficiently work by sharing the power of users’ computer systems around the world in a way that is completed decentralized.

The blockchain is suitable for digital transaction processing, medical records, and the recording of events around the world. The use of blockchain technology creates the potential for repercussions and mass disintermediation for the manner in which global trade is carried out around the globe.

Blockchain technology used for launching ICOs

Since 2008, new and exciting opportunities using of blockchain technology have arrived on the market, such as initial coin offerings (ICOs). Similar to an initial public offering (IPO), ICOs are a new and secure way for startups to raise funds for the development of projects.

It is worth nothing that ICOs are not subject to government regulations. ICOs are used by startups to raise funds for their blockchain-related project or a new cryptocurrency venture by systematically bypassing the regulated and rigorous capital raising process, which are often required by banks or venture capitalists around the world. ICO Ratings are also crucial as investors will get an overview and will be able to know about the best ICOs to invest.

blockchain for ICO

Experts on cryptocurrency and blockchain technology consider ICOs (such as LendoABYSS, Freezone) to be one of the easiest and most efficient methods for small businesses and startups worldwide to raise funds for their blockchain-based projects.

It is an excellent opportunity for regular users to invest in a new cryptocurrency venture, that they see potential value in. There is a specific goal in the launching of initial coin offering of blockchain project. In addition, startups and small business ventures can specifically limit the project funding using the advanced blockchain technology and smart contracts.

Using secure and decentralized blockchain technology, companies and individuals will ensure that every cryptocurrency token will have a pre-designed price, which will not change during the token funding/ICO period. It means that the supply of blockchain cryptocurrency token is static during the ICO sale. Moreover, all the unsold tokens are burned after the ICO campaign. If you are looking for more  information on how to invest in ICOs and other details related to ICO countdowns, visit a reputed site that provides authentic updates on ICO launches.

As a means to minimizing fraud, blockchain technologies are used by many financial institutions around the world. In addition, blockchain-based systems can also be used by well-established and reputed financial institutions as a means of systematically collaborating across the supply chain.

In combination with other technologies such as smart contracts, the blockchain is creating new methodologies and business models that are explored by financial institutions around the globe. The full extent of the cutting-edge blockchain applications and implication will emerge as the blockchain become more embedded and efficient.

How to raise money on a blockchain with a cryptocurrency token?

The core blockchain, cryptocurrency developers and the community related to the launch of the ICO will suggest an initial allocation of tokens which will be developed by using blockchain protocol. Smart contracts are developed and released by using blockchain technology to set aside for future blockchain protocol development.

Cryptocurrency token holders will be able to vote on how to distribute the funds collected during the ICO and will then be set aside for the future development of the blockchain-based products or services.

Contributors to a new cryptocurrency venture can be a series of companies or individuals who require funds for paying salaries, rent, and other expenses associated with the development of the project. Funding decisions must be executed through decentralized voting.

The decentralized approach of the smart contracts and blockchain technology used in the development and launching of the ICO replaces the need for an entity or company with centralized governance.  Many startups also resort to using the ICO marketing guide or ICO planning guide to successfully market their ICOs.

The use of blockchain technology in the development of cryptocurrency-based ventures and the launch of an initial coin offering will probably produce the best long-term outcome for all involved given the nature and goals of most decentralized protocols.

The most common structure of fundraising through an ICO built on blockchain technology is to set up a foundation. Much like corporate governance, the foundation associated with the ICO will have some governance. It will help companies to determine the initial and ongoing distribution of funds raised from the crowd sale (ICO).

Use of blockchain technology as a system of record

  1. Tokenization

The unique physical item is paired with a corresponding digital token by using advanced blockchain technology in order to authenticate the unique physical item. Cryptocurrency tokens are used to bind the digital and physical worlds. The digital tokens built on the blockchain are useful for fraud detection, supply chain management, anti-counterfeiting, and intellectual property.

Tokenization

  1. Digital identity

By using highly secure and efficient cryptographic keys, blockchain technology provides an excellent opportunity for establishing a strong digital identity. The blockchain is considered by many experts to be one of the secure ways to manage the identities of people in the digital world because it is not based on permissions associated with the account. Blockchain ensures a strong system for digital identity. The use of the blockchain technology avoids exposing users to sharing too much personal information.

  1. Inter-organizational data management

The state-of-the-art blockchain technology represents a revolution in how the collecting and gathering of information are done. It is more about efficiently managing a system of record and less about maintaining a database.

  1. Blockchain applications for a financial institution

Blockchain applications are used by financial institutions to carry out audit trails. Banks and other larger financial institutions around the world are using blockchain technology to form a digital relationship with their users over the internet. The blockchain will secure the account information of the users against hackers.

Blockchain technology offers banks and other financial institutions a means of automatically creating a record of who has accessed information on record. In addition, the blockchain will also create an excellent means of setting controls on the permission required to see personal information of the account users of the financial institution and bank.

Application of blockchain as a platform

  1. Blockchain application for smart contracting

Built on blockchain technology, smart contracts used in ICO seek to use information and documents stored on the blockchain network for the purpose of supporting complex legal agreements. The development of the smart contract code on the blockchain is comprised of a program controlling blockchain assets that will be executed by a blockchain protocol and run on the blockchain network.

  1. Blockchain application for markets

Blockchain platforms are used to establish a digitally unique identity for keys to control code, which will express particular ownership rights. The cryptocurrency tokens built on a  platform means that the ownership of a code can come directly to represent a physical item, stock, or any other item. Developers can use a blockchain protocol to set rules on how the physical items or tokens can be transacted.

  1. Blockchain application for automated governance

A DAO (decentralized autonomous organization) built on blockchain technology is an example of automated governance.

  1. Blockchain applications to streamline clearing and settlement

We often hear the term “T+3” in the world of stock exchange and stock trading. It takes 3 days for the trade to be accepted. There are many non-blockchain ways to reduce the number of days for accepting a trade in share trading but it will compromise the security of the trading process.

The share trade is settled and accepted on the day of trade (T+0) with the cutting-edge blockchain technology.

  1. Blockchain applications for automating regulatory compliance

Blockchain technology could enable regulatory compliance in code form beyond just being a trusted repository of information. It could mean improving efficiency in the case of banks and other financial institutions in Anti-Money Laundering (AML) compliance. In addition to this, blockchain technology can be systematically and efficiently calibrated for the purpose of carrying out different tasks such as reporting transactions or permitting transactions of a different type according to exact rules.

The future of blockchain technology

One of the most intriguing technologies currently in the market around the globe is the blockchain. The state-of-the-art blockchain technology has the potential to truly disrupt multiple industries. This technology has the ability to make processes more efficient, transparent, and secure.

Global organizations, investors, entrepreneurs, startups, and governments around the world have all identified itthe  as a revolutionary technology. Many experts believe that  it offers a potential solution for many startups and other businesses to fulfil their unmet needs for disintermediation, transparency, and legitimacy.

For small businesses, financial institutions and cryptocurrency ventures, in particular, the use of blockchain technology can be beneficial for decreasing fraud, providing greater transparency, and significantly simplifying operations.

The benefits of using blockchain technology in small businesses and cryptocurrency ventures efficiently translate to regulators as well. The use of the blockchain ensures the timely and transparent access to data, which will enable more informed decision making by companies.

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