Blockchain – or chain of blocks – is one of the most fashionable concepts in the technological field. And is not for less. According to the experts, after some years of consolidation and development, this Technology is called to revolutionize everything, as a backdrop to the multiple transactions that take place in our daily lives.

“In most cases, it will be incorporated into our lives in a ‘silent’ way. That is, we will use blockchain without knowing it, “says Rodrigo García de la Cruz, CEO of Finnovating and director of the Digital Banking Directing Program at IEB. Similarly, Enrique Dans, Professor of Innovation at IE Business School, believes that “the citizen will not find out, just as he does not know what systems are behind their banks”. We could make an analogy with the internet, which has revolutionized the way we communicate and operate, although the user uses the internet without knowing-or needing it-the TPC / IP protocol or the HTML language.

A revolution … gradual

Dans believes that the incorporation of the block chain “is an important revolution”, but considers that it will be adopted “very gradually, as more and more companies from different industries will see and understand its benefits”. He points out that “there will be a period of adaptation in which we will see how some companies begin to use it to differentiate themselves from their competitors, as a sales argument”, becoming the market standard when they are checking the benefits it brings.

García de la Cruz also believes that he will be arriving in a gradual way. “Little by little we will see blockchain built into our lives”. The real change will occur when people realize the enormous potential of this technology. And the big companies, startups and governments go together hand in hand to incorporate this revolution in our day to day, “he says. Thus, it indicates that “2017 has been a great year, but in 2018 it is expected that many of the projects that use this technology will gradually become an absolute reference”.

It is difficult to establish the time horizon in which we can see this technology fully installed in our lives. The IE professor explains that “the adoption curves in corporate markets are not too modelable because they depend on corporate decisions, which are not technological, but are often political decisions or even marketing”. However, he predicts that “it will be normal for it to arrive in two years”.

Some inconvenients

There is much talk and writing about the advantages of blockchain, but it is also convenient to stop at some of the obstacles to its development. The CEO of Finnovating stresses that it is “a recent and complex technology”, so, for now, “there will be numerous failures until this technology is known and starts operating efficiently.” In addition, we still find ourselves with “regulatory uncertainty”.

The aspect of confidentiality can also be an inconvenience . When talking about blockchain, it is usually related to bitcoin and its use for operations of dubious legality -blanking of capital, buying or selling drugs or weapons, etc.-, but the truth is that the chain of blocks guarantees the total traceability of transactions and the impossibility of modifying said registry. “In case of having to carry out confidential operations, being an open network, the transactions are traceable . However, there are alternatives to this problem, “says García de la Cruz. In addition, he points out that “smart contracts may not be optimal for transactions whose rules change constantly.”

But what will we use it for? “The applications of this technology in everyday life are endless: from the best known, such as payments or property records, to deposit or bond management, automatic execution of guarantees in case of breakdown, voting, etc.”, notes the CEO of Finnovating. We review some of its possible applications.

Identity management

Blockchain is very useful when creating a digital identity, ending the enormous obstacle that implies for the user to have to register and provide supporting documentation when it comes to contracting products and services through the network. If we register in a blockchain developed by consortiums in which several companies are represented -of the same or several sectors-, or even by the government itself, it will only be necessary to provide the documentation once and a master identity key would suffice to access all the services managed by the consortium organizations. And all this without the user losing control of their personal data.

For example, the Estonian government has developed a digital identity solution based on blockchain, granting its citizens access to their data and managing requests from third parties to access such information, as stated in the report ‘The future of public service identity: blockchain ‘ , developed by Accenture. It could serve to unify records such as identity document, passport, Social Security, etc. It could even be combined with biometric identification systemsFingerprint, voice, retina, etc.-. Perhaps also the best solution for the digitalization of electoral processes, although it would be necessary to resolve the way of combining anonymisation – in order to guarantee the secret vote – and traceability – to avoid fraud.

It is also very useful in a private environment. For example, a chain of blocks that includes all types of service providers (banks, insurers, supply companies – light, water, gas, telephony …) would streamline the usual procedures , from the request of a loan to the hiring an insurance or an investment fund, modifying the electricity rate, changing the telephony operator …

In addition, identity management does not have to be limited to people. With the development of the Internet of Things (IoT), blockchain will undoubtedly prove these devices, such as home sensors, vehicles, smartbands, etc., allowing the execution of transactions autonomously and automatically, without the security of the data being at risk.

Traceability

The records created in blockchain are univocal and immutable, so it is the perfect solution to guarantee the traceability of goods. For example, the Spanish Confederation of Savings Banks (CECA) and the Grant Thornton consultancy are working on the development of CK-GT, a block chain aimed at increasing efficiency in money laundering prevention processes.

Another sample is Everledger , which allows guaranteeing traceability in the diamond supply chain, ensuring the cleanness of its origin and transparency in its transmission. It also helps detect possible fraud, identify and recover stolen items, etc. This same model could be applied to all types of high value goods, such as jewelry, paintings, high-end vehicles.

In the specific case of automobiles , it could serve as a guarantee in the second-hand vehicle market. Blockchain could serve as support for a record of the entire life of the vehicle, from the purchase, purchase and sale operations, steps through the workshop for revisions or repairs, insurance policies associated with the car, possible thefts, etc. Also, it could be the solution to avoid counterfeiting brands of all kinds of products: fashion, sports, accessories, technology, etc.

It is also very useful in the transport of goods. This activity, especially when it comes to large shipments – freighters by sea, cargo planes and freight trains – involves a huge paperwork in order to ensure that everything arrives at destination and that what arrives corresponds with the declared. All these documented protocols are necessary to prevent theft and loss, guarantee security – prohibited merchandise, food security, etc. – formalize the payment of customs duties and taxes, etc. Blockchain streamlines these procedures, preventing possible fraud, human errors and delays in transit due to loss of documentation or discordances. Further,facilitates the query of progress in the supply chain. The Danish shipping company Maersk already incorporates this technology to digitize its operations, as ComputerWeekly.com reports .

In the real estate sector it would also have applications. The creation of a chain of blocks would allow incorporating all kinds of information about the property, such as construction data, memory of the materials used, mortgages and pending charges, transmissions made,  efficiency label, tax payment, etc. It is an ideal tool to avoid fraud, both between individuals and with the Administration.

Provision of services

The blockchain technology also offers many possibilities in the provision of services. For example, in paramátricos insurances -in which the compensation is based on the occurrence of a certain circumstance that gives rise to the payment- connected to external databases. For example, the Axa insurance company already has in the market Fizzy, one sure flight cancellation, which materializes through a smart contract databases connected to air traffic automatically indemnifyingto the insured in case the flight is canceled. The same could happen in other types of insurance, such as a Life policy – indemnifying if you receive notification of the insured’s death -, agricultural insurance – paying if the harvest is ruined by hail, frost … -, etc.

We used to talk about identity management in IoT devices. Blockchain could serve, for example, to link a smart fridge with an ecommerce and make the purchase automatically, making the transaction safely. Likewise, it will facilitate the contracting of insurance related to the new economy. For example, it will be easier to hire a policy for use that provides coverage when making a trip using a car sharing company -like Car2Go or Emov-, if a product is rented on P2P platforms -like Relendo-, etc.

The chain of blocks will also serve to improve the management of clinical records,facilitating access by authorized actors. Above all, blockchain will guarantee the integrity of the files, detecting intrusion attempts and avoiding manipulation of the data.

On the other hand, blockchain offers a new way to face the classic loyalty programs,instead of the classic points awarded associated with a card issued by the companies, the system can be based on sensors -connected cars, quantifying wristbands, etc.- and integrate a broad spectrum of companies, making offers and combined promotions.

With its sights set on a more distant future, blockchain could even serve to regulate the circulation of autonomous vehicles. The programming of a certain route in a chain of blocks will allow the coordination with the rest of the journeys of other automobiles, managing in detail every movement or lane change to optimize the traffic.