In this lesson we will look at the impact blockchain technology has on consumers, business models, marketing and advertising. In a world where everybody can transact with everybody and add billions of people to the marketplace, where transactions can have really any size. They can be cheap, and really the fees of doing transaction can become zero. And they can be fast, where they are immutable, which means permanent with in-records. It allows new businesses marketing and advertisement opportunities. And it really impacts every transaction step, from compliance and supply chain to advertisement, marketing and to sales. Let us explore different industries and functions and how blockchain technology can be implemented as part of the digital transformation today and in the long-term future. Blockchain is really for every industry. We will see it in the legal field, supply chain, government management, how energy is traded and managed and calculated. We will definitely see it in the retail space, in the food processing industry, healthcare I've mentioned before both on a government level as well as on a personal level. Even travel hospitality, insurance business, down to education, like certificates for example, can be approved by utilizing blockchain technology. Let's look at the financial sector of course first. In finance alone, it can be used for making international payments, trading stocks, bond and commodities and providing an audit trail for regulators. Blockchain technology can create new forms of assets and make it possible to trade existing illiquid ones, such as mobile minutes, energy credits and frequent flymarts. Blockchain technology can be used to track provenance, stamping or fraud and counterfeiting in areas such as luxury gets, fine arts, pharmaceuticals, food and government documents. Of the 7 billion people in the world, only 4 billion own a toothbrush, but nearly 7 billion have access to a cellphone. So, mobile communication is really everywhere. But only 20 percent of all world population have currently access to the banking system. Now, with blockchain technology, everybody with a connection to the Internet can transact with everybody else, allowing social scalability beyond our wildest dreams. The new economic models previously impossible before the emergence of blockchain technology are coming more and more in our daily lives. Some people call it the cryptoeconomics. It can provide the underlying economic principles that empower a fast scaling and shared economy, demanding new banking and transaction models. The era of fintech has been ripe for revolutions, and we'll see this over the last years in the areas of remittances, lending, community engagement, online first insurances, mortgages, even investment in peer-to-peer lending. Again, blockchain technology here comes in. Let's look at wire transfers as an example. South Korea just allowed officially the transactions of over 2000 or up to 2000 dollars base and cryptocurrency for international transfers, speeding up the transactions from days down to minutes at a fraction of the cost. But so much on financials, let's look what happens on these other industries we mentioned. Healthcare. In the healthcare industry, it's really another sector perceived to be on the path to digitalization. Blockchain technology can be used to secure digital assets, like medical records. It can also make processing claims more efficient and make it easier for patients to share records with other providers, while still maintaining control, giving some data to the insurance company, some data to their orthodontist, some data to their general physician. The legal sector I've mentioned, here, it is an industry that has long been relying on a vast amount of data in the form of paperwork. It could benefit enormously from the widespread implementation of smart contracts, agreements that can be automatically activated actions based on specific conditions. For example, the smart contract might require a driver to be up to date on their car payments in order to physically start the car. And as a trend is of most blockchain solutions, smart contracts can drastically reduce transaction costs and provide superior security versus traditional means. Another industry heavily looking into blockchain technology is media and entertainment. Here, it has the potential to eliminate or dramatically lower transaction cost as one of their key benefits. Think of an example where blockchain could enable a news website to charge readers per article, rather than per month. With low cost microtransactions like these, they can be processed through a blockchain without the fees that existing payment platforms demand, taking it one step further. A blockchain letter could be used to secure intellectual property like music and film, making it possible to enforce usage rights and mitigate digital piracy. So, the entertainment industry is embracing it. And for them, it creates also new opportunities for sharing and monetizing their content. Makes it possible for musicians, writers and other artists to embedded royalty payments into their digital files, their ebooks. And other creating a page himself every time their work is bought or resold. It can be used by publishers to run publications funded not by ads, but by micro payments issued by the readers' browser. We really see the long-term impact and benefits sooner than later, reorganizing from supply chain over marketing to consumption for subcultures. Think about a consumer groups like vegans or do it yourself coming together and creating their own market spaces. It's really an opportunity created token to be used to track, let's say, the food supply chain, from producer to consumer and include rewards for expertise and recipes. Stepping outside the industry of few, what about company functions themselves? Of course, first and foremost, sales. Transactions cannot be costly and time consuming. Credit card transaction fees average anywhere from 1.5 to three percent of the actual transaction. And they take 90 days to fully clear. It's a trust text the merchants are paying. The bank transfers takes days and cost multiple dollars. A report from Nielsen estimates that in 2016, the losses topped over $24.71 billion of credit card transactions and the merchants were still responsible for 28 percent of those losses making it a huge and very expensive way of managing their transactions itself. But based on blockchain technology, these transactions can happen much faster today and on ramps and off ramps from the bitcoin or the cryptocurrency to the real world are possible. So for example, you can buy an Amazon gift card or a Starbucks gift card with bitcoin today. Another area we will see blockchain probably sooner than later is human resources. With blockchain technology, we can track verified credentials, like a course completion, awards won, training certification in an immutable way. And it's a natural fit for blockchain based higher end solutions. We can reward customers centric behavior of individuals and teams that value creation with tokens. Think verified LinkedIn data with digital signatures for experience, education, recommendations and created in a decentralized or even outsourced teams that could use blockchain-based collaborations and reward solutions to create value for their customers. The management function itself will likely be touched by blockchain technology. There might be large companies that will have no full-time employees outside of their executive level suite. Decentralized auto-enormous organizations like DAOs, those are organizations that have no formal managers at all, just smart contracts that are executing the agreements might be another possibility. But it requires that executives excel to understand the product, communicate the vision of the brand, the mission of the organization, the story for their community and tools and collaboration infrastructure to create and deliver value to the customers. They have to understand the whole supply chain. For example, when you buy into a shop today and buy a bag of coffee, you really don't know if it's organic free trade even if it's written on that label today. With blockchain technology, that can be changed as well. You can be able of the provenance of a product you're buying, end to end that creates a verifiable supply chain and that can become part of the value propositions for your customers. Are companies using it? Yes. Global organizations with lots of present business units and requirements, like Walt Disney, see the potential for blockchain technology from secure Internet of Things, to managing their logistics and Intel of finances. They have created something called DragonChain, which allows enterprise programmers to utilize blockchain technology in their environment and make the technology available in open source. It is arriving. Blockchain. technology is arriving in the enterprise. Juniper Research surveys for 400 top level executives showed that 67 percent said they had already invested more than 100,000 into the technology. And 91 percent say they would be spending at least 100,000 in 2017 to understand what blockchain technology can do for them. I hope you are as excited about the potential of the blockchain technology for customer engagement as I and many executives in many industries. What opportunities do you envision with the implementation of blockchain technology in your organization? Please share your ideas on how blockchain can be used in your environment, area or industry. I'm looking forward to the discussions.
