Blockchain is becoming increasingly popular in many industries that are looking for ways to take their businesses to the next level. The way information and data are shared and stored with the use of blockchain technology allows companies to improve their processes by allowing faster more transparent and secure transactions.
At first, blockchain technology was initially seen as the underlying technology used by cryptocurrencies, which are becoming increasingly popular among retailers and institutions. Even if cryptocurrency is now a widely traded market, investors know that the impact of blockchain and cryptocurrencies goes far beyond the financial world, as they are revolutionizing many industries, including tourism.
Let’s have a look at how blockchain technology and cryptos are used – or are likely to be used – within the travel sector.
Let’s first define what blockchain is and what its advantages are
While it might sound complex at first, the concept of blockchain is actually quite simple. A blockchain acts as a public ledger, gathering all transactions done between parties within the network in blocks. These blocks are then added to one another and securely linked by cryptography, forming a chain of blocks – hence the name “blockchain“.
To understand the value of blockchain, you need to be aware of some of its most crucial characteristics. For example, a blockchain is decentralized and immutable. Therefore, data and information are shared across a peer-to-peer network, where everyone can see all available information about all transactions. There is no central point of control. It is also impossible to modify or delete a transaction once recorded in the blockchain, as each one has a specific timestamp, and all blocks are permanent.
How can blockchain be used in the tourism and travel industry?
The stable, secure, and unalterable nature of the information stored in the blockchain is a great advantage for the travel industry, which is constantly handling and sharing personal and private information about customers. Luggage also changes hands multiple times during a journey and using blockchain technology to help improve tracking the movements of customer baggage could make things easier and more transparent.
Payments and other financial transactions can also be simplified and more secure with the use of blockchain by improving the level of transparency in the process and allowing a greater level of trust among all involved parties. Accepting payments in cryptocurrencies can also attract new customers that are looking for ways to spend their tokens on vacation.
Some companies are already accepting Bitcoin and other coins as a means of payment, like Travala.com, Cheapair.com, and GetYourGuide. Many believe that more and more companies will accept crypto payments in the future to ensure a secure and traceable method of payment.
Another aspect of tourism that could be improved by blockchain is the rating system of accommodation, airlines, activities, and any other aspect of traveling that can be rated. Forum and client reviews can often be manipulated, as we never know who wrote them. Blockchain technology could ensure transparency and accuracy about who wrote a review, which will increase consumer trust.
Finally, using blockchain in tourism can also help companies reduce processing times by cutting out the middleman thanks to smart contracts, which will ultimately be cheaper for companies and improve their overall processes. Smart contracts are contracts that are automatically executed when all parts of an agreement are met, which can be great when it comes to data security, transparency, and flexibility.
There are many possible applications of blockchain and cryptocurrency in the tourism industry giving all the technology’s characteristics. However, this is a new technology that is still in its early stages, which might bring some challenges.