How to Utilize Blockchain Technology for Your Business Model

  • By Simran Advani
  • 09-01-2023
  • Blockchain
how to utilize blockchain technology for your business
A blockchain business model integrates three fundamental characteristics of blockchain technology: decentralization, data integrity, and accountability. Business is carried out primarily through peer-to-peer exchanges within a reliable, consistent network.
 
The notion of decentralization fundamentally transforms the way businesses operate. Numerous variables, such as how earnings are created and the stream of exchanges and agencies, are intended to enhance how enterprises and end users benefit.

Why Do Blockchain Business Models Exist?

Blockchain is a new business model as a whole. Institutions can use blockchain technology to transform their organizations into a federalization framework, which could also modify how their company operates. It adjusts the entities, the process of transactions, and earnings while ensuring that expansion is retained throughout the shift.
 
Ever since the advent of bitcoin in 2009, it has been countless incidents where blockchain technology failed or, at the absolute least, blockchain technologies utterly failed. It was partially due to the way the integration occurred and the businesses' imperfect business model.
 
Blockchain-based business practices like BitConnect were nothing more than the Ponzi scheme. There are also additional concepts that prey just on an unsuspecting public. We will dismiss these scams and focus on legitimate blockchain business strategy models.

Best blockchain Models

1) Blockchain As A Service (BaaS)

This is the most broadly used business model. It provides businesses with just an ecosphere to assist them in managing their blockchain system. Firms can explore, check, and undertake research thanks to this ecosystem. End users, including existing companies or startups, are not required to comprehend how well a blockchain works or configure it before continuing to work on it. Since it excludes the need for hardware, BaaS enables companies to concentrate on their development process. Bitcoin and Ethereum could also be used to provide a service. For example is EBaaS (Ethereum Blockchain as a Service), which Microsoft manages and provides in collaboration with ConsenSys. Amazon (AWS), IBM (BlueMix), and Microsoft are typical examples of BaaS. (Azure).

2) Token Economy- Utility Token Business Model

The cumulative satisfaction acquired from consuming goods or services is referenced as versatility. The utility token model contains using tokens to create economic functionality. Ripple and Stellar are fantastic examples of this model. Banks that are components of their system will be capable of sending funds utilizing XRP (Ripple) or XLM (Stellar) tokens. These are utility tokens that strengthen the network and make connectivity operations easier. A token's top three variables are characteristics, critical role, and intention. Businesses keep a portion of the utility tokens and utilize the rest to power the network. They profit when the value of utility tokens fluctuates.

3) Blockchain-Based Software Products

Companies must consider purchasing a blockchain solution and incorporating this into their system if they want to endorse blockchain more quickly. This one will support the creation of blockchain companies that would create solutions and advertise them to more giant corporations afterward. Trying to prove blockchain technology to organizations can be highly profitable because, apart from receiving a sensible initial payment, they will also be required to provide post-implementation assistance. The best example is the sale of the MediaChain blockchain to Spotify. This was carried out to address royalty problems in the music industry. Another reason for acquiring this business strategy is the market's talent shortage, as businesses wish to avoid going through the time-consuming process of developing talent.

Conclusion

Choosing the appropriate model is wholly reliant on the nature of the business and the goals it wishes to achieve. There needs to be a written formula or situation for how a business model should operate. It can combine different ideas, and businesses can tailor them to their needs.

Last Updated in January 2023

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Author

Simran Advani

I am Simran Advani. I work as a Content writer at Reveation Labs. We are an established Blockchain Consulting and Development Company based in the US, founded to empower businesses with solutions using the latest technologies.