What is blockchain used for besides crypto?

Beyond cryptocurrencies, blockchains are used mainly for moving and settling money, issuing digital versions of financial assets, tracking goods and proving identity. Financial uses have made the most progress. Many projects in other fields have stayed at the pilot stage or been shut down.

How is it used for payments and settlement?

The most widely used application is the stablecoin, a token designed to hold the value of a currency such as the US dollar. Stablecoins move over public blockchains at any hour, settle in minutes and are used to send money across borders.

Banks have built their own systems. JPMorgan's blockchain unit, Kinexys, says it has offered blockchain-based accounts to clients since 2015. Central banks have tested digital national currencies, known as CBDCs. These bank systems usually run on private networks, a distinction covered in public vs private blockchains.

What are tokenized assets?

Tokenization means recording ownership of a traditional asset, such as a share in a fund, a bond or a piece of property, as a token on a blockchain. Advocates say this allows trades to settle faster, markets to run around the clock and assets to be divided into smaller pieces.

Banks and asset managers have issued tokenized funds and bonds. The limits are legal, not technical. A token is only as good as the legal claim behind it, and someone trusted must still hold the underlying asset.

Does it work for supply chains and identity?

The idea in supply chains is a shared, tamper-evident record of where goods have been, visible to manufacturers, shippers, customs officials and retailers. The record is mixed. TradeLens was a shipping platform built by Maersk and IBM. In November 2022 the two companies said they would shut it down. Maersk said it had not become commercially viable and had not won the industry-wide cooperation it needed.

There is a deeper limit. A blockchain can show that a record has not been altered. It cannot show that the record was true when entered. Linking a ledger to the physical world requires trusted people or sensors, an issue known as the oracle problem.

In identity, the aim is to issue diplomas, licenses and similar credentials as digitally signed records that the holder controls and anyone can verify. Few such schemes have moved beyond trials, and a permanent public record sits awkwardly with privacy laws that give people a right to have data deleted.

Does every use need a blockchain?

No, and critics say many proposed uses never did. A blockchain is slower and costlier than a standard database. It earns that cost when several parties who do not fully trust one another need to share one record and no one is acceptable as the central keeper.

Where a trusted operator already exists, a conventional database generally does the job. The uses that have lasted are mostly close to money.