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Beyond bitcoin: 7 ways to capitalize on blockchains

Peter Wayner | Sept. 1, 2015
Bitcoin’s widely trusted ledger offers intriguing possibilities for business use beyond cryptocurrency.

Microtransactions

In the past, many businesses embraced subscription services that charged one amount for access to an unlimited number of transactions. Charging one amount is simpler for everyone to understand and simpler to track because it removes the need to count all transactions.

While these solutions are popular and simple, they have problems of their own. It becomes harder to track which offers are truly valued by the customers and which are consumed because they're part of the bundle. Overconsumption and waste are common because the users don't need to pay for each item. Complex offerings are often driven out by cheap ones.

The blockchain can open up more complex transactions by tracking everything. While this is possible to do with a regular database or file, it doesn't have the same certainty or broad trust. Customers can be included in the computation of the blockchain, giving them the chance to validate transactions. If customers build the blockchain, they'll trust it and the enterprise.

A future version of the blockchain could make it simpler to create localized currencies. Already some are using basic bitcoin software to create their own localized money for transactions inside organizations, much like companies create their own store credit cards. Some stores or businesses may want to use a similar process to certify their own currency for use by their customers.

Reward points

Many companies have set up reward programs, like airline miles, that build loyalty by rewarding frequent customers. These well-established programs are tracked by basic ledgers running on standard databases.

Moving these rewards program over to a blockchain can increase trust of the users by making the transactions public. It can also allow organizations to open up transactions so that users may trade points among themselves. Many of the current rewards programs strictly limit the way that points can be traded, sometimes keeping them to spouses or people living at the same address. Others prohibit transfers altogether. A more open, blockchain-mediated marketplace can unlock some of the value, make it easier for customers to trade points, and vastly increase interest in your rewards program.

 

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