The terms Bitcoin and Blockchain often get confused. Blockchain serves as a platform for cryptos, and its scope and potential extends far beyond the world of cryptocurrencies. Without Blockchain, there would be no Bitcoin or any other currency in crypto space. Initially, Blockchain was created for Bitcoin, but today, it has become more secure and a transparent way of processing different kinds of data. Therefore, various applications and uses of this technology have become endless.
This innovative technology has created a new form of online platform, just like Internet gave us the ability to send emails, shop online and do so much more. Today, Blockchain can be applied to voting procedures, record keeping, financial instruments and this is just the tip of the iceberg.
Bitcoin, On the Contrary
While if see Bitcoin, it is a cryptocurrency, that was created and held electronically on the PC or in a virtual wallet. It is decentralised, so no one sees it, and no individual, institution or bank can control it.
In 2009, when bitcoin burst into the financial space, in a short span, computers all around the world started running sophisticated programs to mine blocks of bitcoins by solving complicated mathematical equations. It was decided that there can be only 21 million bitcoins. Out of these, 17.0255 million( as of 10th May 2018) are currently in circulation, and just 3.9745 million need to be discovered. Today, miners are making money every minute, every hour, by verifying transactions.
How Is Blockchain changing the world?
Let’s take a real-time example, to explain it better and highlight differences between Blockchain & Bitcoin.
Blockchain technology has allowed currencies like Bitcoin to revolutionise the way we think about them and process transactions. A recent area where this technology has seen increasing interest by corporations is supply chains, and it is highly expected to raise the industry standard. Blockchain allows supply chains to run with some advantage which eliminates many hurdles that the industry is facing currently.
For instance, the supply chain is made up of many different entities, and it is difficult to coordinate with one central information system. When you purchase a product from your local supermarket, the information about how fresh is the product relies on the data being scrutinised all the way throughout the supply chain. In such a case, companies can use blockchain technology to solve such issues and to store this information in a public ledger. The supply chain can use this central system for storing the data, which can be validated quickly by any other entity within the chain. This is how blockchain is making a huge difference and making it easier for businesses.
Bitcoin Blockchain vs Blockchain for businesses
The distinction between Blockchain & Bitcoin is crucial, as while digital currencies have seen certain aversion and scepticism on account of their volatility. At the same time, Blockchain has revealed its incontrovertible potential for transforming the way; we can manage data and do business.
In addition to this, many aspects make Bitcoin Blockchain & Blockchain for businesses, different from each other. Blockchain that supports Bitcoin was explicitly developed for cryptocurrency, and this is one reason that it took awhile for people to realise that blockchain could be adapted for use in other areas, as well. So, the technology had to be modified quite a bit to meet the rigorous standards that businesses require. Let’s have a look what makes Bitcoin Blockchain & Blockchain for businesses different.
- Bitcoin transactions are stored on a peer-to-peer network in a distributed ledger. This network is open, anonymous and public. The blockchain is the sustaining technology that maintains this transaction ledger. But, this technology can be used for a much broader range of assets than just cryptocurrency. For instance, tangible assets like cars, real estate and perishable items, as well as intangible assets like private equity, bonds and securities can get benefited with this technology. Many companies are using blockchain to track the provenance of luxury goods for minimising fraud, document tampering and double financing.
- Today, Bitcoin is flourishing due to anonymity. Anyone can look at the Bitcoin ledger and see every transaction that happens. On the other hand, businesses have AML (anti-money laundering) and KYC (know your customer) compliance requirements that entail details relating to who exactly they are dealing with. Participants in business networks require privacy, which is precisely the opposite of anonymity.
- The blockchain is dignified to change how people do business by offering trust. While participants in a company might not trust each other, they can always trust blockchain. It provides many benefits to business like reduced time for finding information and verifying transactions, decreased costs and reduced risk of collision, tampering and fraud.
Although it is far from the most significant change that blockchain technology will make to the world, it is quite clear how this technology can be applied to various industries and not just financial sector.
So remember, even though Bitcoin entirely relies on the blockchain, it is not the only system that uses this innovative resource. Today, this technology is being brought into play by various sectors including banks, supply chains, online advertising and many others. Every industry that would benefit from a transparent system of storing information between multiple parties is switching onto Blockchain technology.