It is no secret that Bitcoin, Ethereum and other cryptocurrencies have exploded in popularity over the past year. For starters, cryptocurrency increases transparency through the blockchain tech that makes it possible for employers to track hours worked and other metrics in real-time. This leads to more efficiency in financial planning and cuts down on dishonesty from employees. It also makes it easier to pay international wages because they can be transferred using the same digital currency as opposed to expensive conversion fees or waiting days for the money to reach its destination.
In addition, cryptocurrency makes it easier to transfer funds between individuals because there are no banks involved. This allows businesses to transact directly with one another without relying on middlemen.
Five characteristics of blockchain:
A purpose-designed for the public blockchains were created to solve real problems with transparency, speed and security. They are intended to be used by everyone, but we know that will not be the case for some time. As a result, there is an element of centralization that is inherent in this technology. For example, Bitcoin users have heard about how it was hacked multiple times and had millions of dollars stolen from their wallets.
- Distribution:
The benefit of blockchain is that it allows for the distribution of information in a way that removes central points of failure. No one person or business controls the ledger, so it is accurate and transparent. The ledger itself has been duplicated thousands of times in many places around the world and can be accessed by anyone with an internet connection. To hack this system, you would have to take over all copies at once, which makes it impossible without taking down the entire internet.
- Encryption:
One of the most important features of blockchain is that it is encrypted. When data is stored in a block, it is encoded in such a way that only the people with permission can access it. This means that records cannot be changed after they are stored, and it creates transparency for employers, employees and vendors. A business or an employee would be able to verify whether information has been tampered with after the fact.
- Immutability:
The third trait of blockchain is that it is immutable. Once a record is confirmed, no one can change it. Immutability means that records cannot be erased or altered after the fact, and everyone can trust that the data is accurate, which could lead to fewer human errors and more efficiency in business planning.
- Tokenization:
By tokenizing a product, one can make any good or service that is in transition into a currency. As an example, the company Everledger offers services for identifying diamonds. In essence, the company provides a blockchain-based service that allows anyone to identify if a diamond is real. They have partnered with some of the world’s best diamond merchants in order to enforce their brand and bring transparency to their industry.
- Decentralization:
When a blockchain is decentralized, it means that it is not controlled by a single party. When information is stored on a decentralized system, no one person or entity can control what data will be added to the blockchain. Once the data has been encoded, it cannot be removed or altered. This means that businesses and other organizations can verify information without having to worry about getting hacked or having someone delete their data.
Existing and emerging technologies enable blockchains:
Blockchain is a subset of a larger technology called a distributed ledger, or DLT. This refers to a shared, decentralized record of all transactions made inside of a network. A group of validators verify the data, thus creating a series of blocks. These blocks can then be distributed to thousands of computers at once, making it nearly impossible for individual agents to change the information in the database. Blockchain-based systems and decentralized applications are not new ideas. There have been many experiments and prototypes created that have used distributed ledgers for everything from asset management to food supply chains.
Blockchain in HR:
Human resource is a possible early adopter of the technology. The first step that businesses can take is to create ledgers for their own systems. Then, they can start working with companies that produce these ledgers in order to make a more seamless transition for employees and vendors. Once the transition has been made, companies can then start exploring the other applications listed above. Blockchain could also be used to create a digital resume where employees can add resume content and potential employers can reach out to potential candidates. The digital resume would be secure and free from hackers because it would be hosted on a decentralized network. Bitcoin is a game-changing technology, and if you want to know more about it then look no further than Tesla Coin.
Final thoughts:
As the technology emerges, it will be interesting to see how HR departments implement these new systems. Until then, blockchain technology remains in its early adoption phase. By adopting these distributed ledger systems now, organizations can be prepared for the future. They can start working with the right vendors and consult with their legal teams before making a decision regarding any changes to their systems. Unfortunately, blockchain’s benefits are not available to every business or employee and will only become more important as time goes on.