Prospective investors or users who are diffident about cryptocurrencies and their associated technology, known as blockchain, have a variety of reasons that prevent them from fully embracing the technology itself. This can range from issues pertaining to security, illegal activity and limited use.
However, a closer examination of blockchain technology reveals that these issues presented are easily-debunkable myths that could be mere afterthoughts as more and more companies begin to leverage its use in their respective sectors.
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Blockchain has Security Issues
A common notion associated with blockchain technology is that it’s rife with security issues, but blockchains like Ethereum or Bitcoin have never experienced any hacking incidents. Although certain applications on top of blockchain, such as cryptocurrency exchanges and The DAO–decentralized autonomous organization, have had incidences of hacking, the ledgers themselves are resistant to attacks.
Looking under the hood of blockchain technology, hashes link each block with all the blocks behind it and ahead of it. As a result, redistributed ledgers will reject any record that contains altered data, preventing unwanted changes as a result of human error or malice.
Adding another layer of security is that blockchain alternatives are already being developed with even more enhanced security. Hedera Hashgraph has raised $100 million from institutional investors to create a new commerce network adopted from its “hashgraph consensus” technology–a new type of distributed public ledger that Hedera Hashgraph says is faster and more secure than current blockchain technologies.
“As a technology, it’s a fundamental advance in the world of distributed systems,” said Hedera CEO Mance Harmon, in an interview with VentureBeat. “It has fantastic performance, and it achieves the best in security one can have in the field.”
Blockchain Attracts Illegal Activity
In the same fashion that the internet can attract hackers tapping into personal information or public highways being used to transport drugs, the blockchain can attract illegal activity. Nonetheless, the potential to do good essentially outweighs the bad.
For example, the use of blockchain has allowed the health care sector to start developing applications that take advantage of peer-to-peer data distribution, offering better versatility and security over current database systems. Companies within the health care sector have discovered ways blockchain technology can help improve their care facilities, increase efficiency, amplify security, facilitate transactions easier, and interact with patients better.
Blockchain technology can help pharmacies track their inventory more efficiently, as well as keep better track of dispensing medication to patients. Furthermore, it can help care providers, such as physicians, specialists, subspecialists, and surgeons share patient information easier for faster expediting and reducing redundancy or file errors.
In fact, a survey by technology giant IBM revealed that 16% of health care executives are planning to incorporate blockchain technology into their respect facilities within the next year. With the rising costs of health care, having more efficient operations can help reduce the bottom line, which could translate to lower costs for patients.
Blockchain is Only For Cryptocurrencies
Because blockchain technology forms the basis of cryptocurrencies, a common myth associated with its use is that it is strictly isolated to digital currencies. As previously mentioned, blockchain technology can be integrated into a multitude of industries.
Per a report, the four biggest auditing firms globally – Deloitte, EY, KPMG and PwC – are part of a group of 20 banks in Taiwan that are experimenting with blockchain technology for auditing financial reports. By utilizing blockchain technology, it will allow the firms to conduct external confirmation, which is the process of collating and examining audit evidence.
The platform, developed by Taiwan’s Financial Information Service Co. in concert with the 20 banks, migrates the transactional data to a blockchain where banks have the ability to validate the transactions themselves. By performing the migration to blockchain, auditing firms have the capability to view the transactions through a traceable and tamper-proof chain of data.
According to FISC, the new platform utilizing blockchain technology could allow for a reduction in the confirmation time from “half a month” to “within a day.”
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