Blockchain is set to becoming the de facto technology for facilitating financial transaction around the world. Blockchain, also referred to as an engine of the global economy, is expected to reach 135 billion dollars by 2023. This proves that adopting Blockchain is not only essential but imminent for all business sectors.
Image source: wall-street.com
As Blockchain inches closer to the major sectors of the economy, an increasing number of eCommerce app development businesses are now discussing the probable application of Blockchain for a majority of other domains apart from just finance; for example, E-commerce.
The E-commerce sector has transformed the way people across the world shop. Now Blockchain is set to transform the way E-commerce sector operates.
The use of Blockchain for E-commerce will aid in establishing a revolutionized economy. While both Blockchain and E-commerce enable transactions, Blockchain makes the transaction even quicker and more secure than ever.
What is Blockchain?
As defined by Internet Society, “Blockchain technology enables distributed public ledgers that hold immutable data in a secure and encrypted way and ensure that transactions can never be altered.
While Bitcoin and other cryptocurrencies are the most popular examples of blockchain usage, this ‘distributed ledger technology’ (DLT) is finding a broad range of uses. Data storage, financial transactions, real estate, asset management, and many more uses are being explored.”
Blockchain is a shared ledger that securely stores, acts upon, and shares a digital asset either manually or automatically.
It can manage end to end-user experience – from product search and selection to payment and post-sale customer queries, and that’s just an initial part of the user experience journey.
Types of E-commerce for Blockchain
Blockchains are specific databases, paired with very modernized software that connects Blockchain to the external world.
However, not all Blockchains are similar. There are about four types of commonly used Blockchains for E-commerce. All four of these are widely available in the market for E-commerce retailers.
1. Bitcoin – Bitcoin is a cryptocurrency, and it is the prime reason why Blockchain technology came into existence. Bitcoin has been adopted by several popular organizations such as Tesla, Microsoft, Google, and Shopify. Thereafter, a slew of many other businesses turned towards adopting Bitcoin as their payment alternative. Accepting Bitcoin to facilitate payment processing not only brings in an opportunity to enter the massive cryptocurrency market but also an effective way to make use of Blockchain.
2. IBM – IBM does not have a cryptocurrency of its own. But the Blockchain platform it offers is powerful for online retailers with large, complex operations.
3. Ethereum – Ethereum is a cryptocurrency like Bitcoin. But it comes with its own set of pros and cons when compared to its rival. It has not been widely adopted as Bitcoin, but its network is capable of hosting various other forms of cryptocurrencies. One of the most mainstream uses of Ethereum is hosting smart contracts. The reason why Ethereum is ideal for E-commerce vendors is that it provides retailers with a space to run their full-fledged Blockchains.
4. Custom – This is the most convenient and flexible Blockchain solution for E-commerce retailers. A Blockchain development company can help businesses customize Blockchain as per their business goals and objectives. Besides, it is highly economic to use to boost the profit margin in the long run.
Types of E-commerce for Blockchain
• Integration with Business Processes – Blockchain can be implemented in many more ways than just for processing online payments. The main reason behind the growth of Distributed Ledger Technology (DLT) is its ability to integrate with new and existing business systems. For an E-commerce retailer, this can facilitate integration between their web store and a plethora of external and internal processes, systems and partners.
• Cost-Effectiveness – Blockchain has the power to combine product images and descriptions, online payments, inventory management, with other business processes. This results in reduced system maintenance, the lesser requirement of IT support personnel, and fewer administrative activities to be performed. Blockchain empowers E-commerce businesses to invest more time for the core business operations and less time in managing their E-commerce store.
• Ease of Use – Currencies powered by Blockchain are immensely comfortable to use. Unlike traditional currencies, a person need not visit a regulatory authority to register an account for themselves. Blockchain allows you to accomplish the process from within the comfort zone. Moreover, the process is free of cost. You pay nothing to create your account. The virtual currency account comes at zero cost.
• Faster Transactions – It takes an enormous amount of time when it comes to transacting traditionally. For instance, transferring money across countries or continents may take up to several days. But Bitcoin-based transfers, on the other hand, are swift. They take only a few minutes to accomplish money transfers. Most essentially, Bitcoin transfers can be processes anytime, from anywhere and almost instantaneously.
• Security – DLT facilitates the highest level of security for online databases. Though there have been examples where some vulnerabilities or loopholes in smart contact coding led to fraud, there have been zero verified frauds occurring due to a major Blockchain backbone framework. Even a single data attack can cost an E-commerce retailer millions in revenue, alongside a blow to their market share and reputation. But with Blockchain, they can have a level of security that safeguards that entire data structure and prevents possible data breaches in the future.
There are a massive opportunity and benefits of Blockchain technology for E-commerce vendors which is quite evident.
If your business is seeking an edge over the competition, it is about time you adopt Blockchain for your retail business. Share your views about the impact of Blockchain on E-commerce using the comments area below.