How to use Blockchain technology in e-commerce

What is blockchain technology?

Blockchain is a decentralized digital general ledger for tracking economic transactions. It is designed not only to record financial transactions but everything that goes into them. The best feature of Blockchain is that it allows to generally display the user’s holdings and the transactions that they have made through the system.

Moreover, it also anonymizes the user through effective encryption. Deciphering the cipher takes a long and difficult account, which makes it the most secure way to handle money.

Challenges in the e-commerce sector

Blockchain technology is transforming the e-commerce industry by decentralizing control and cutting the middleman’s presence from the landscape. But, before exploring the potential of Blockchain technology for the e-commerce industry, let’s dive into the current challenges that the e-commerce industry faces.

  • Rising costs One of the main weaknesses of the seller in the traditional ecommerce business model is the involvement of a middleman who takes a large share of the money on every purchase. The seller has to pay the transaction processing fee to complete each transaction.
  • Uncertain security- Protecting buyers’ data is another major concern for this line of business. The system needs to gain the trust of its customers and assure them that their personal and financial data are safe. The current state of the e-commerce industry fails to provide guaranteed security to users.
  • Time consuming – The e-commerce model includes a set of processes like supply chain, logistics, payment gateways, etc. To manage all these processes, the e-commerce industry has to deal with these middlemen every day. This consumes a lot of time to complete the whole process.

How Blockchain Will Lead the Ecommerce Industry in the Future

Blockchain e-commerce technology is a boom not only for sellers but also for buyers. Few of the challenges that can be tackled by introducing Blockchain into the e-commerce industry are as follows:

  • Reducing costs- With Blockchain, the e-commerce industry can rely on Blockchain technology to manage inventory, process payments, product database, and other business activities. This results in less spending on maintaining systems or hiring IT support teams to maintain them. Cryptocurrencies like Bitcoin, Ripple, etc. will reduce fees charged by third-party institutions like banks during transactions.
  • Cyber ‚Äč‚Äčthreats – Despite using a secure transaction network, the e-commerce industry is always at risk of losing their customers’ data and money due to unwanted cyber attacks. Blockchain technology is an ideal solution to solve these challenges. It provides the highest level of security by using distributed ledgers to manage e-commerce database management systems.
  • Fast processing- Blockchain e-commerce technology removes the dependency of brokers, workforces, and third-party organizations from the e-commerce model. It saves a lot of time in the overall process ranging from stock management to placing orders and delivery at users’ door.


These challenges have troubled sellers from the start. Hence, integrating Blockchain technology into the e-commerce sector can definitely be a good idea for the whole system. Here comes the need for Blockchain technology for the e-commerce industry capable of solving all challenges alone.

Many e-commerce companies have already started investing in Blockchain technology to run their businesses smoothly. The day is not far away when Blockchain technology penetrates the entire e-commerce industry.