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What Is Blockchain

The blockchain is one of the great technological advances of recent years, but also a great unknown, despite the potential it has to redesign virtually any industry.

More and more companies and professionals are looking to learn first-hand what it is and how they can apply it to their industry. Although many have not yet figured out the key, as more industries adopt it, the need for professionals specialized in this technology will become more evident.

In fact, according to a 2020 survey conducted by the consulting firm Deloitte, globally, 39% of respondents have incorporated this technology into their company’s production, compared to only 23% the previous year, and 83% of respondents say that companies lose competitive advantage without adopting this technology.

What is blockchain and how does it work?

The blockchain is based on a process that allows interacting and exchanging data without the need for intermediaries, through a single record, consensual and distributed in nodes that make up a network.

Understanding what this technology is easier with an example: currently, for a transaction or exchange to be secure, a third party is needed to act as a verifier. In a blockchain there is no such third party: it is the users themselves who provide that security, as everyone has access to the record of transactions that have taken place. Thus, if someone tries to compromise the veracity of the data contained in the register, all participants will be witnesses. Therefore, the blockchain is inviolable because all actions are recorded and all those involved in the process have access to the basic data on the transactions made.

Understanding the blockchain

This new technology can be approached in three different ways:

  1. from a technical point of view, it is a set of nodes that use the same communication protocol to validate and store information in a registry common to all of them. Each node can be a computer or a particular user.
  2. From the business point of view, it provides a layer of reliability that allows value to be exchanged without intermediaries, with the consequent cost savings and reinforcement of transaction security.
  3. From the legal point of view, it guarantees compliance with all regulations, as the community itself commits to verify it.

All this is possible because the process uses two identification elements: the public key and the private key. The first would be similar to a bank account number, and is visible to other users to interact with each other by exchanging value or information. The second, on the other hand, can be understood as a password that only a particular user possesses, and is therefore capable of identifying him or her. Both are interrelated and, in addition, each movement performed contains the information of the previous block.

Each new action creates a unique code, called a hash, which is replicated and accumulated in subsequent actions. Thus, if a user tries to perform an unauthorized operation, the chain will be broken and the other users with access to the registry will be able to see not only the situation, but also when it happened, where it happened and the identity of the person responsible.

Advantages of blockchain for companies

Blockchain technology has enormous potential in sectors of all kinds, although one of the pioneers has been the financial sector. Because it is based on transactions of something as sensitive as money, the use of blockchain allows for improved security, traceability and regulatory compliance.

Virtually any company can benefit from it, especially those with e-commerce, as it can allow them to optimize and automate transactions. Other companies, such as those focused on document verification, can do without intermediaries and make user identification processes more efficient.

Its use also allows the protection of users’ identities, while providing transparency on the different operations carried out. It therefore has direct applications in the healthcare sector. As it is useful for tracking transactions and exchanges, it can be used in industries related to food or transportation.

The great potential of this technology increases the need for qualified professionals to develop and implement it in companies. Therefore, professionals who opt for this disruptive and continuously growing sector see their employability increase.

Given this reality, training becomes an indispensable element. Aware of this, Banco Santander, in collaboration with the prestigious Massachusetts Institute of Technology (MIT), launches the Santander Tech | Digital & Innovation by MIT Professional Education Scholarships and offers a total of 400 scholarships to university graduates and professionals between 25 and 32 years old, with a maximum of eight years of professional experience.

The Santander Tech | Digital & Innovation by MIT Professional Education Scholarships encompass five 8-week, fully online Professional Certificate programs. Among these programs is the Blockchain: Technological Disruption course, which aims to convey the fundamentals of this technology to students from different fields and professionals from various sectors without prior knowledge of this area so that they can understand how it works and learn about its practical applications in the path of digital transformation.

Applications and examples of blockchain

As you have seen, the possibilities of this tool are enormous in all industries. After all, it is still just a database, so the applications are as wide as they are today. Here are some examples from different sectors:

One sector that stands to benefit enormously is logistics. The Belgian company T-Mining is already using this technology to increase safety in port container logistics thanks to the traceability it provides. In addition to reducing costs, it will improve efficiency in data exchange.

As in logistics, the same theory can also be applied in the tourism sector. For example, in baggage control at airports. Amadeus, a leading company in the travel industry, expects this technology to be one of the pillars of the digital transformation of the travel industry. More secure passenger identification, passport checks with no margin for error, more intuitive loyalty programs… The possibilities in this sector are vast.

It has also made its place in the third sector and NGOs. Sending cryptocurrencies can be a great solution when sending economic resources to areas affected by natural disasters or in conflict zones. In 2017 the United Nations sent 10,000 cryptocurrency vouchers to Syrian refugees to be redeemed on the participating marketplaces of this project.

The medical record is the most important element in the healthcare sector. The integrity of the information it contains is vital to people’s health. So is the privacy of sensitive data, which is why the blockchain seems to be the perfect system for storing any medical data.

It is also revolutionizing social networks and online sales platforms and the traditional business model of companies as big as Facebook, Twitter, eBay or Amazon is threatened by the rise of the blockchain. They are the intermediaries, so if they are no longer needed their business model collapses. These types of platforms will have to use the tool if they want to compete with the new ones emerging from this technology. Openbazaar is already developing a fully secure protocol using blockchain. This allows the buying/selling of products between individuals and companies without intermediaries and with total confidence.