Understand the use of blockchain in software development

by Arthur · April 13, 2023

Blockchain is the latest technological advance that ensures increased security and transparency. Since it was first developed in 2008, this technology has attracted the interest of many. Due to its unique characteristics, blockchain offers many opportunities in many industries, including finance and medicine.

Regardless of its use, this technology is changing how processes work. The software development industry can also benefit from using blockchain because of its potential to ensure the accuracy and consistency of data.

Get our activist investing case study!

Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet or print it out to read anywhere! Sign up below!

Q1 2023 hedge fund letters, conferences and more

Gates Capital Management is reducing risk after rare down years [Exclusive]

Gates Capital Management’s ECF Value Funds have a stellar track record. The funds (full name Excess Cash Flow Value Funds), which invest in an event-driven equity and credit strategy, have produced an annual return of 12.6% over the past 26 years. The funds gained a total of 7.7% in the second half of 2022, surpassing the 3.4% return for Read more

Table of Contents

A brief introduction to Blockchain

Blockchain is the invention of an individual – or a group of individuals – known as Satoshi Nakamoto. This technology was created in 2008 and was first associated with Bitcoin, a decentralized digital currency based on the PoW consensus mechanism.

Without blockchain, cryptocurrencies would not exist today. For the first time in history, people can spend digital money without relying on an intermediary, and that is only possible because of the blockchain.

Since the database is reliable, popular companies have implemented this technology to increase their operations. Walmart, for example, uses blockchain to help customers trace the origin of products before buying them online.

Similarly, Microsoft enabled the development of dApps on the blockchain platform Azure Blockchain Service to issue invoices faster and securely and track food safety. With blockchain, companies can save time and money spent on processes.

Blockchain is not just about crypto

Crypto is the first thing that comes to mind when you hear about blockchain. After all, this technology powers popular cryptocurrencies like Bitcoin and Ethereum, making digital transactions possible and efficient. Over the years, digital assets have become increasingly popular, appealing to investors seeking to maximize profits.

Some even believe that crypto is the future of finance. However, the industry was never consistent and cryptocurrencies have experienced fluctuations in price over the years. Therefore, it is important to be realistic when joining the crypto space and be prepared for what it entails.

Choosing a reliable cryptocurrency is important, as it can affect the entire investment experience. For example, crypto enthusiasts prefer to buy ethereum instead of other currencies because of its outstanding features and high performance over the years.

While blockchain enables cryptocurrency, the technology also has applications in other industries, such as:

Supply chain management;
Logistics;
Production;
e-commerce, etc.

Businesses are adopting blockchain because of its ability to reduce costs and automate tasks, thereby saving precious time that can be used to develop ideas that can drive growth. Here are other benefits blockchain brings to businesses:

It keeps the data safe from unauthorized access;
It ensures immutability in transactions;
It enables faster transactions;
It increases transparency in business relationships.

Blockchain in software development

Software development involves computer science activities where developers create, design and distribute software. Since the process is complex, it is important to look for ways to increase efficiency. This can be achieved by using different technologies, for example:

Artificial intelligence;
Low code;
Cloud-based development;
Analytics;
Blockchain.

Blockchain can boost the software development sector due to its security and immutability. Developers can create blockchain-based applications without relying on a bank or financial institution.

In addition, the technology also eliminates worries about becoming a victim of hacking and theft. Let’s further discuss what blockchain can do for the software development sector.

It increases security

In a software development project, security is of utmost importance. Fortunately, blockchain can guarantee that through immutability and decentralization of data. This means that it is impossible to manipulate the data, unlike traditional applications where a user can access all data.

Any hacking attempt is easy to recognize, since all the transactions are recorded on the blockchain, and if someone tries to change them later, the network owners will notice it immediately.

It ensures data integrity

Software developers also deal with data integrity challenges. Apps are created daily and it can be difficult to ensure that they are not compromised due to data integrity. Blockchain brings a solution to this problem because it offers transparency.

Through smart contracts, for example, developers can write code that cannot be changed after being distributed on the blockchain, thus ensuring that everyone has access to reliable information about what is happening throughout the process.

This transparency creates trust among teams in the software development sector. Since everyone is aware of the latest updates, there is no room for disputes and misunderstandings.

It provides faster time-to-market

Society is moving at a fast pace today and businesses in the software development sector are struggling to keep up with market demands. That is because it takes considerable time to launch the product after the concept is developed.

But blockchain provides faster time to market, making processes like digital payments less complex. Due to blockchain’s decentralized function, a team can develop an app independently of another, regardless of location.

This means that developers are not limited in what they can create through blockchain technology. They don’t need the consensus of everyone involved in the app development process – which is different than developing a traditional app.

Using blockchain also allows software developers to create more robust applications that can recover more quickly from disruptions. Traditional applications can break down due to poor internet connection or failure of a database server. However, blockchain creates a more robust network infrastructure because, unlike servers, it relies on multiple copies of data stored in the nodes.

It automates processes

The use of blockchain in software development results in faster turnaround times for critical projects because the paperwork used is reduced.

Most business practices are prone to error, but blockchain automates processes such as content creation through smart contracts, making them easier. Automation increases the quality of software developers’ services, which can help businesses in the industry thrive.

It strengthens start-ups

Blockchain technology has led to new opportunities in the market, allowing more talented developers to compete with established companies.

This is possible because blockchain-based applications are developed on open source platforms. Therefore, it is easier for those with sufficient knowledge to build a software product. Even startups can create something impressive, even if they lack resources or capital.