Blockchain is a digital distributed ledger system that acts as a public record of transactions between parties. A central authority does not keep track of these transactions. Instead, each node has a copy, thereby democratizing access.
Blockchain applications have enormous potential for advancing digitilization in a variety of fields. Particularly in the public sector, there is potential to use blockchain for identity management, personally managed data storage in the health, insurance, and financial sectors, decentralized energy based on neighborhood electricity trading solutions, and new election and voting procedures.
Business and Industry
Everyday life for citizens and businesses is frequently about proving that they have rights. When selling a house, for example, an entry in the land register must be used to demonstrate that the seller actually owns the property. The seller of a motor vehicle must be in possession of the vehicle at the time of sale. The birth certificate officially certifies the child’s birth in the context of birth registration and population management. The state’s primary responsibility is to keep these various rights in registers and to store and track them when these rights change.
Digital Public Administration Services
Using blockchain technology to develop new public administration digital services is an opportunity that neither governments nor public institutions want to pass up. From ensuring the integrity of citizenship data in government databases to proving that your next used car will not kill you, blockchain has the well-known potential to allow people to blindly trust data in ways never before possible, even if they do not trust the government itself.
Smart Contracts and Tokenization
Tokenization is currently gaining popularity. This is the process of converting a tangible or intangible asset into a digital token that the holder can then hold, use, or transfer via the blockchain. Custodians and analog proof of ownership are no longer required. Real and virtual assets, such as real estate or precious metals, can be used in this manner. The asset itself is not changed in any way; only the way its property is managed is. Blockchain manages the transparent and immutable ownership history and transfers it between buyers and sellers.
Experts compare blockchain technology to the Internet’s transformative effect. There has been a lot of progress in recent years, particularly in the field of blockchain-based applications. This is due to the technology’s ability to transform and digitize trust-based systems. The emphasis is on the fact that two users who do not know each other and thus do not trust each other from the start can carry out transactions that are secure for both parties in a decentralized manner. The applications include any type of value transfer, intelligent contracts, irreversible records such as deeds or land register entries, and much more.