In today’s market, global trade ties are becoming intertwined with cryptocurrency’s newest technology. If you want to start bitcoin trading in only three steps, visit an ideal and reliable trading platform like the Oil Profit app. You will get the best liquidity, and the platform is immune to volatility risk. Furthermore, recent developments in blockchain technologies have positioned several companies to explore the future of the oil industry. The below-mentioned portion will detail the current state of cryptocurrency within oil and gas, as well as forecasted developments for the future.
Current State
Oil companies have used the blockchain for the last 2 years only a. They are looking for ways to improve performance and accountability within their business. Users could apply many use cases to the industry, and blockchain has been used in shipping, supply chains, record keeping, etc.
Developments for the Future:
The government of Dubai, UAE, is looking to implement blockchain technology into their government. Dubai is even looking to digitize its land registry to accomplish this task. In addition, Dubai has announced plans to build a new 2.6-mile-long bridge connecting the United Arab Emirates mainland with the Palm Jumeirah artificial island. The bridge will be financed by an initial coin offering (ICO).
Based on the current trends with blockchain technology and cryptocurrency, experts feel that this trend will continue towards oil and gas in the future. Therefore, blockchain will continue to be used for gas station supply chain management and payments.
Cryptocurrency and blockchain help in supply chain management in the oil industry:
Currently, oil companies are trying to adopt technology to help with the oil search process. There is equipment that geologists and oil drillers use in these situations. Sound Ventures proposed one use case where users could replace this equipment with blockchain technology. Blockchain technology could serve as a foundation for an effective update of the current equipment.
Oil drillers are currently using expensive and complex software that we can implement into a blockchain architecture to provide all information that needs to be kept track of while maximizing efficiency simultaneously. It would be a significant potential saving to the oil industry.
In addition, oil companies are currently using satellite technology to track the supply chain of their crude oil. They are doing this to ensure that all oil is accounted for and that the transport of the crude is safe and secure. With a blockchain solution, there will be complete transparency for all parties involved in this process.
Reduce overhead and number of cost intermediates:
Cryptocurrencies can provide a solution to a number of the current issues in the oil infrastructure. In today’s market, a large amount of overhead is involved with investing in this industry. Banks and other intermediates take anywhere from 10% to 20% for any of the transactions involved with oil companies. Cryptocurrencies will provide better business operations to oil companies in the future on top of increased profitability by almost diminishing transaction costs.
Enable trading of energy supplies:
The current market has a limited amount of suppliers and consumers at both ends, which creates an imbalance in prices across the globe. Cryptocurrency can allow for instant payments, which will drive the price down and provide more users to the market. In addition, cryptocurrency would allow greater access to the oil industry, which will drive further adoption of cryptocurrency technology in this space.
The oil industry has been moving positively toward cryptocurrency and blockchain technology recently. It led to OPEC deciding to adopt an electronic trading system for their member nations instead of traditional paper-based trading systems. It proved incredibly successful for both corporations, as each had a better functioning environment with less overhead and increased profits from shopping around for suppliers.
A Better contractual system:
There are currently several challenges associated with the contract process for oil exploration. First, it involves an unknown amount of intermediates that take a cut which adds to the cost. Cryptocurrency and blockchain technology can help with this issue by providing transparency through smart contracts. It will allow companies to have greater control over the process while cutting out intermediary costs in traditional contractual processes.
Other developments:
Blockchain is still new, but the future looks bright for the cryptocurrency industry regarding oil and gas. In the future, oil companies will start to look towards implementing blockchain technology into their business. It means that cryptocurrency could significantly impact the oil and gas market within the next 10 years. In conclusion, it seems clear that blockchain technology can significantly impact the oil industry in terms of reduced costs and improved profitability over time.
