E-commerce industry has been booming at a rapid pace in recent years and the future of the industry looks very bright. Almost everyone shops online these days and the growth prospects are exemplary. In this blog, we shall see the opportunities for blockchain based e-commerce business in today’s world and how the advent of blockchain has transformed the e-commerce industry.
Right from when online selling and online shopping took its baby steps in 1994, it has adopted all the latest technological advancements. The latest among the latter is blockchain which has immense potential to revolutionize the world. Blockchain based ecommerce platform development will help Blockchain vendors who are providing e-commerce solutions.
Let us start with the basics.
What is Blockchain Technology?
The blockchain is a digital ledger that is decentralized and can store anything of value. It was invented by an anonymous person called Satoshi Nakamoto who used it to record the transactions of bitcoin, the world’s first real cryptocurrency. All the transactions in a blockchain are validated by a mutual consensus of everyone who has been a part of the network.
The absolute transparency and decentralized nature of blockchain technology would, in turn, mean that there would be absolutely no need for middlemen in any of the business practices where the blockchain technology is adopted. Blockchain technology has found its way into health care, digital identity storage, smart contracts, cryptocurrency development and much more.
Get to know more about top 5 Blockchain Applications for small business
Challenges Faced by E-commerce Industry Today
Things are not all rosy for the e-commerce industry. We need to understand the challenges that the e-commerce industry faces today so that we can analyze the ways in which blockchain based ecommerce platform can be improved and enriched.
E-commerce and online retail sales is an extremely competitive business and there are a large number of small and large scale vendors who are selling the same product for different prices. In order to survive this tough competition, businesses have to embrace smarter techniques and adopt the latest technologies to gain a competitive edge over others and stay in the race.
Along with the stiff competition, sellers have to deal with middlemen and agents who ask for a very hefty commission for their services during the selling process. An example of such third party expenses are the fees that the sellers pay for processing the transactions to facilitate payments for the completion of the transactions.
All the e-commerce websites face the security concern related to the protection of consumer data. The consumer needs to trust the business and assure themselves that their personal and financial details that they provide at the time of purchase will be kept safe. The e-commerce businesses are spending thousands of dollars these days in data encryption and other measures to ensure the complete protection of their customer’s data.
E-commerce business is a very complex scene where a lot of activities are linked to one another. The operations like supply chain, logistics, payments etc are linked to one another and managing the operations and dealing the intermediaries are a very complex task. E-commerce selling is a complex process as it involves an array of operations such as supply chain, logistics, payments, and more. Managing these operations and the intermediaries involved is another key challenge for the industry.
All these challenges are driving the sellers into a frantic state and everyone is in search of a technology that is capable of handling every single operation in the business efficiently and solve the aforementioned challenges very effectively. The answer they are looking for lies in blockchain Technology for ecommerce. Let’s explore how this technology is going to change the face of e-commerce.
Blockchain Will Be The Driving Force Behind E-Commerce In Future
To alleviate all the difficulties faced by the e-commerce industry and to bring things in order, we can adopt blockchain for ecommerce as the backbone of the e-commerce industry.
Let’s see how blockchain technology can be regarded as the saviour of the e-commerce business.
Improved Operational Efficiency:
Blockchain technology is entirely decentralized and is capable of streamlining the operations of e-commerce business with increased efficiency. Smart contracts can be used to regulate the intermediaries involved in the trade like the logistics and payment processing parties. It also ensures the integration with various management systems and streamlines workflow.
Increased Trust and Transparency:
Another significant advantage of Blockchain technology for ecommerce is that it brings transparency in transactions that garner the trust of the customers. All the transactions taking place in the business is recorded in a shared ledger and this cannot be modified by anyone later on. Blockchain technology brings in high security, radical visibility, and faster processing speed. Any data or transaction can, later on, be traced through the decentralized system as well.
Bitcoin is the most popular and may be the first use of this technology. E-commerce sellers can use bitcoin and many other cryptocurrencies to avail cost-effective digital payment solutions. Since there are no payment processing charges involved in a transaction of cryptocurrency, the currency can be accepted by sellers at zero fees.
Consumer data of an e-commerce store, whether it is stored in a centralized manner or in the cloud is always vulnerable and is always under the threat of hacking. Even the most well-encrypted systems can fall prey to hacking. The Blockchain for ecommerce provides a decentralized scenario, which is practically impossible to hack from a single point of entry.
Seeing the extensive benefits of blockchain based ecommerce platform, it is quite evident that businesses should adopt it for expansive growth.
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