Blockchain technology has revolutionized the digital world. It is exciting and has enormous potential to fundamentally alter the way transactions are made in the travel industry. In this article, we will take a closer look at blockchain, describe what it is, and talk about its potential uses within the hospitality sector.
In technical terms, a blockchain is a continuously growing long list of records, known as blocks, which are linked to one another and secured through cryptography. Each block contains a cryptographic hash, a time stamp, and transaction data. Due to its encrypted form, a blockchain is resistant against any type of data intrusion or modification.
A blockchain is managed over a peer-to-peer network, with a fixed protocol for communication and validation of new blocks. Once the data is recorded into these blocks, it cannot be modified retroactively without the complete alteration of all subsequent blocks. Within the peer-to-peer structure of a distributed network, security is driven by consensus that ensures the originality of data for all the nodes in a network.
Blockchain was primarily conceived for Bitcoin – the most popular cryptocurrency – which uses strong encryption to regulate the generation of units and to verify the transfer of funds. At present, there are various types of cryptocurrencies other than Bitcoin, such as Ethereum, Litecoin, and Monero.
Even though the technology is still in its infancy, the total value of the currency in blockchain is approximately $9 billion US (€7.9 billion) at this point in time, which is a staggering amount. Importantly, there are various hospitality businesses such as airlines, restaurants, and hotels that could utilize this technology to improve their guest satisfaction.
Hoteliers will benefit from adopting this technology by saving more money and forming easy connections with their guests. Blockchain will aid in market research, improve transparency and efficiency of the processes. Hoteliers could also use it to track lost baggage or items of their guests.
The most important aspect of blockchain is that both the guests and the hotels can make use of this technology. By creating processes into a blockchain, you can remove middlemen, and directly implement your loyalty programs without the requirement of an expensive platform.
With the increasing number of hospitality businesses adopting the blockchain technology, stakeholders in the hospitality industry can take advantage of its utilization. There are a number of ways this technology can be used effectively:
Though blockchain may seem scary or complicated at first, once you sit down and look at the topic a little more in depth, you will see that it can be a great tool to use in your hotel, connecting you and your customers, and increasing not only the security of transactions, but also your guests’ satisfaction.