Home Business Why Is the Blockchain Technology Important?
Let's say that a new technology is being developed that could be used for real estate deal. The parties get together and complete the details on timing, special circumstances and financing. How will these parties know they can trust each other? They would have to check their agreement with third parties – banks, legal teams, government registration and so on. This one is back to square one with the technology to save costs.
In the next stage, the third parties are now invited to join the real estate deal and provide their input while the transaction is being created in real time. This reduces the role of the middleman significantly. If the deal is this transparent, the middleman can be eliminated in some cases. The lawyers are there to prevent miscommunication and lawsuits. If the terms are disclosed upfront, these risks are greatly reduced. If the financing arrangements are secured upfront, it will be known in advance that the deal will be paid for and the parties will honor their payments. This is the last stage of the example. If the terms of the deal and the arrangements have been completed, how will the deal be paid for? The unit of measure would be a currency issued by a central bank, which means dealing with the banks once again. Should this happen, the banks would not allow these transactions to be completed without due diligence on their end and this would imply costs and delays. Is the technology that useful in creating efficiency up to this point? It is not likely.
What is the solution? Create a digital currency that is not just as transparent as the deal itself, but is in fact part of the terms of the deal. If this currency is interchangeable with currencies issued by central banks, the only remaining requirement is to convert the digital currency into a well-known currency like the Canadian dollar or the US dollar which can be done at any time.
The technology being alluded to the example is the blockchain technology. Trade is the backbone of the economy. A key reason why money exists for the purpose of trade. Trade at large percentage of activity, production and taxes for various regions. Any savings in this area that could be applied across the world would be very significant. As an example, look at the idea of ​​free trade. Prior to free trade, they would have had a tax system that would have taxed the country. After free trade, these taxes have been introduced. Even a small change in trade rules had a large effect on the world's trade. The word trade can be broken down, it can be broken down, it can be broken down.
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