Blockchain technology has emerged from the darkness in the last few years. Until recently, it was used synonymously with cryptocurrencies like Bitcoin. With all the questionable practices that surround that market, it’s understandable if you view the technology questionably.
However, blockchain is something being studied and implemented by industry-leading companies across a wide variety of sectors from transportation to healthcare to law. Most agree its transformative abilities will be like nothing seen since the dawn of the Internet.
But how do you know if now is the time to get involved, and how do you keep from getting burned in the process?
Blockchain and Purpose
The first thing your company must have is a purpose. You don’t get into blockchain just because of buzz or bragging rights. It operates on peer-to-peer networks, so it’s not something you do in a vacuum. You need at least one other partner for it to be of value.
And the larger the network, the more secure it will be.
That’s because each individual “block” of data in the chain links to the last. These all must undergo an authentication process by entities on the chain. Hacking something like that wouldn’t be as challenging with only two parties involved, but with several, it becomes almost impermeable. But hacking isn’t the only concern.
The Right Partnerships
Your partners on the blockchain should share your sense of purpose. There should be some reason why it makes sense to them to be included. Maybe you both want to save administrative costs or perhaps streamline redundancies that commonly arise in your shared dealings with one another.
The Right Platform
Once the purpose and partnerships are in place, you need the right platform. There are many in existence and others emerging. The Blockchain in Transportation Alliance (BiTA) is one of the best examples of partners pooling their resources into a blockchain platform that is customized to their specific industry.
Individuals and smaller companies also tend to flock toward Ethereum — also a form of cryptocurrency — for its “smart contract” protocol, which allows execution of contracts without the need of a third party.
The more you can trust the purpose, partnership, and platform behind your blockchain, the safer it will be — and the more sense it will make — to use it for your business transactions.
If you still have questions or you need legal help from an attorney with actual United States Securities and Exchange Commission experience, consider the law offices of John Teakell. He has practiced in multiple areas of law for more than 30 years. Reach out today.