Blockchain vs The Cloud: Which Is Better?

The cloud is actually a physical location where files are stored. Blockchain can be described as millions of people’s computers. There is no actual server for the blockchain.

It’s common to describe the cloud as simply somebody else’s computer. Though not entirely accurate, it does convey the idea that the cloud is actually a physical location where files are stored and computing is done. It’s a powerful server is the gist of it.

On the other hand, the blockchain can be described as millions of people’s computers. There is no actual server for the blockchain. All of the transactions are shared by anybody who has downloaded the blockchain.

This is the one major difference but there are others as well. In this article, we will go over what those differences are so you can decide where you should focus your attention. 

Security

Every transaction that happens on the blockchain is registered and verified before being sealed with encryption. Whether you are buying Bitcoins, sending them to somebody else, or building an app on the Ethereum blockchain, nothing can change the transaction details. 

This is because if it is changed, it would be noticed by everybody else who has the blockchain on their computer and would need verification for the transaction to be resolved. Any input changes on a hash will result in a change of the output. If the input never changes, then the output never will either no matter how many times the algorithm is run.

In the case of a cloud server, there is one server that can be breached and nobody would know until it was too late. There are no so-called “miners” that verify the transactions so security is much laxer on a cloud server than on the blockchain. There is always a vulnerability in any server which can be hacked. Some are more difficult than others, of course, but a very sophisticated hacker, group of hackers or even nation-state actors can find a way in if they are dedicated enough. 

The blockchain is virtually hackproof for this reason but the cloud is something that can be accessed by sophisticated hackers. 

No middleman

A server or the cloud has a centralized management system. It could be the bank that uses it to store their customers’ data or it can be a hosting company that keeps the data from websites on their network. In any case, there is one governing body responsible for how it operates.

The blockchain is totally decentralized and there is no middleman at all. Nobody decides on their own authority how things are going to work on the blockchain. It is a very democratic process that is generally governed by the consensus of its miners or other users of the blockchain itself. 

This means that it is much more efficient when it comes to organically going in a certain direction rather than relying on one authority to make all of the decisions. Even transactions can happen much faster because of this system as opposed to credit card or debit card payments that require more processing time since they go through many different processes.

The whole point of cryptocurrency is to put the power of finance into the hands of the people. Anybody can be their own bank thanks to cryptocurrency. They can lend out the money they have without being at the mercy of a bank or central authority and buy as much of the coins as they see fit. And all of it at a very low cost since the only fees are to pay the miners who are verifying the hashes. 

Transparency

Because the blockchain exists on potentially millions of computers, anybody can see exactly what is happening on it at any given time. The cloud is a mysterious and vague place that is hidden away from sight. Nobody knows what is happening to your data or other information there. 

This lends itself to being much more trustable and can be used in different applications in which transparency is vital. Fraud can happen on the blockchain of course, but it is more difficult to do and everybody sees that it happened right away. There are no secrets on the blockchain. 

Transparency is the reason that the blockchain is becoming more widespread in industries like supply chain management and healthcare. 

In the case of supply chain logistics, it is the perfect way to make sure that there is no miscommunication between the parties involved in getting a product to market. From the manufacturer to the recipient, and everybody along the way, there is a visible trail to which everybody has access. 

Healthcare administration is responsible for a lot of waste of resources from time to money. And it is mainly because of the lack of sharing of information between entities. On the blockchain, transparency helps everybody have access to the same information. With it, a pharmacy can make sure that a patient is not prescribed the wrong medication because they have the same information the doctor has. On the same token, if somebody switches insurance providers or even doctors, their information goes with them thanks to the blockchain. 

Cost

Another downside to cloud computing is the cost. Giants such as Amazon and Microsoft have the market cornered to provide servers for complex operations like rendering video for gaming and other high GPU computations. As such, they can charge whatever they want which ends up costing companies a lot of money.

Since the blockchain is on millions of computers, a lot of complex computations can be done by using idle computing power from individual computers rather than one central server. 

This cuts costs down to a fraction. Rather than be beholden to these corporate giants that can charge whatever they want, most of the processing gets done by ordinary computers since there are so many of them using the blockchain. As more companies end up occupying the blockchain space, the more access there will be to this computational power and the costs will reduce even further. 

*This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice.

5 Impressive Blockchain Applications for Small Business Owners

It is an era of smart gadgets, cool apps, and big data. In this time of emerging technology, do you often wonder how you can tap into the right technology to empower your small business?

This article will put light on one such technology which could completely change the way you manage your business affairs: Blockchain!

Started as a public transaction for bitcoin, blockchain has now evolved into a technology used for dynamic purposes — from cloud computing & storage to business contracts and from payment methods to supply chain management.

No wonder the community of entrepreneurs, businesses, and enterprises, all are trying to grab hold of this innovative technology for its benefits.

Multiple blockchain applications can help you boost your business while being easy on your finances. But, before we dive into that, let’s first get a solid grasp of what exactly is blockchain and how it can benefit small business owners.

Simply put, blockchain is a growing list of records called blocks that are linked using cryptography. It is a time-stamped series of record data that is managed by a cluster of computers not owned by any single entity. These blocks are secured and bound to one another through cryptographic principles.

Some of the features of the blockchain application include: 

  • Transparency
  • Accountability
  • Enhanced Security
  • No Transaction Cost
  • Decentralized Technology
  • Distributed Ledgers
  • Faster Settlement

In the coming years, your business can escalate towards success if you get on board with implementing these 5 most impressive blockchain applications:

1. Payments and money transfers

The massive inflow of cash can make your banking experience a mess. And often, you are expected to pay hefty transactional fees to banks to transfer a lump sum amount of money.

In such a scenario, blockchain emerges as a warrior that can defeat your adverse banking experiences while giving you a smooth and secure transaction method. Having its roots in cryptocurrency, this seems to be the most prominent and beneficial application of blockchain.
Through blockchain technology, you can instantly transfer funds in an extremely secure manner without any intermediaries or extra fee.

It also comes in handy while paying wages to international/remote employees and contractors. Abra, Bitwage, and Coinpip are a few companies that are leading the path of transferring funds or handling payrolls via blockchain technology.

2. Smart Contracts

Be it starting a new firm with fresh contracts or entering into new terms in your existing business, documenting fair and reasonable contract often becomes an uphill battle. And to add to your problems, there are always middlemen or third parties making the situation more complicated.

Now imagine if self-automated computer programs could carry out the terms of any contract. It isn’t a far-fetched dream — it is precisely what “Smart Contracts” is.

The term “smart contract” may sound like a newly coined technological jargon. However, you’d be surprised to know that the term has existed since 1993. It was only after a decade that “Smart Contract” became the buzz in the business world. The credit for this goes to the Ethereum Project, which “is a decentralized platform that runs smart contracts: applications that run as programmed without any possibility of downtime, censorship, fraud or third-party interference.”

Blockchain Technology will allow you to form self-executing contracts, i.e., smart contracts, while eliminating the need of a third party. It will not only save you a decent amount of money (which your lawyer would have vacuumed out of your pocket), but it will also enhance security, traceability, and accountability.

3. Cloud Storage

Are the various cloud hacks in the news making you question your cloud storage charges? Do you often wonder if the price you paid for your cloud storage solution worth it? Its exorbitant fee can become overbearing for your business as they lack security and transparency.

However, it is practically impossible for a firm to store data without these clouds. It is where the introduction of blockchain can prove to be beneficial. Blockchain cloud storage solution takes the user’s data and breaks it up into small chunks.

Further, it adds an extra layer of security and distributes it throughout the network. Each chunk of data is stored in a decentralized location. This method makes it impossible for hackers to gain access to your complete data. If intruders try to hack into it, they first get encrypted data and then get only a chunk of the data. It makes blockchain cloud storage solution one of the safest options while being easy on your finances.

4. Supply chain management

Today’s consumers are curious and well informed. They are attracted towards a business that can provide them the complete details of their products-from manufacturing to sale. However, it isn’t an easy task to keep full track of each transfer of your goods.

This is where you can rely on blockchain supply management to help you get real-time information of your data. It would increase transparency and visibility, improve inventory management while reducing delays and frauds. Tracking the supply chain and digital trail information would help you to build trust among your consumers.

5. Raise Capital Globally

If you are willing to raise more capital for your business via global investors, blockchain is the way to go. As digital currency operates independent of geographic boundaries and can be transferred easily without any international fee, it gives every business an equal opportunity to raise funds.

Summing it all up

These blockchain applications will help you scale up your business and gain maximum profit by optimally utilizing the blockchain technology. With blockchain, you don’t have to worry over things like data breach and lack of privacy anymore — your business transactions are protected by a system that you can rely on.

On top of that, with blockchain, you don’t require a central hub anymore; it serves as a bridge between vapors devices and help you carry out transactions at low cost.

Author Bio:

Lucy Manole is a creative content writer and strategist at Right Mix Marketing Blog. She specializes in writing about content marketing, SEO and social media. When she is not writing or editing, she spends time reading books, cooking and traveling. You can follow her on Twitter at @rightmixmktg.