Blockchain, why is it so disruptive?
It seems that everyone is talking about Bitcoin and Blockchain these days, be it on the news, at work or the neighbours down the road. But what is it really and why does it have the potential to be so disruptive? In this article, we break down the fundamentals of Blockchain and explore how it will impact us in the future.
Bitcoin first appeared in a 2008 whitepaper authored by an unknown person or persons named Satoshi Nakamoto. The whitepaper originally detailed the concept of a peer to peer electronic cash system later launched called Bitcoin that enabled online payments to be transferred directly, without an intermediary. As part of the Bitcoin implementation, they also created the first Blockchain database to manage the digital currency. Blockchain provides a way to record and transfer data that is transparent, safe, auditable, and resistant to outages. 2008 was an important time in modern history, the global financial crisis was in full swing and trust in the world’s financial institutions was at an all-time low. Bitcoin’s release was an attempt to change that, and more surprisingly is that Bitcoin wasn’t the revolutionary part. It was rather the technology platform that made it all work called Blockchain that proved to be the game changer.
What is Blockchain?
Blockchain is a decentralised global public ledger that records every transaction made on it. These transactions are verified by a group of individuals using complex algorithms, which ensures that the records remain untampered with, as once they are added to the Blockchain they cannot be removed/changed. The Blockchain ledger gives people the ability to complete monetary transactions without the need for central banks or government regulation. As everyone has access to the ledger, the associated risk of trusting these central entities is removed.
“Blockchain is to Bitcoin, what the internet is to email. A big electronic system on top of which you can build applications. Currency is just one.” Sally Davies, FT
Right now, we are in the infancy of Blockchain, most of the applications and use cases haven’t even been created yet. But just look at how far the internet has taken us in 20 years, it has made the world smaller by allowing us to collaborate over great distances, get news updates by the minute and watch HD content from anywhere. Imagine what Blockchain can do with 20 years of development behind it.
We already have some innovative examples coming to the market already, for instance:
- MiVote is utilising Blockchain to change the way we vote and take away any doubt on the results.
- VOISE is trying to change the way we consume and pay for music, by allowing participants to pay the artist directly as the Blockchain records every time you listen to a song.
Then there are existing services that are utilising Blockchain’s decentralised framework to change the way they operate.
- Cloud Storage: Where you allocate storage on your home computer, that others can utilise as if it was a data centre.
- VPN (Virtual Private Network): Allowing others to remotely access and utilise your IP address.
- Supercomputers: By combining thousands of PCs, they utilise the combined idle processing power to achieve supercomputer levels.
Who can we trust?
The future of Blockchain is disruptive, it can make the organisations that use it transparent, decentralised, efficient, and secure. Transparency is the way forward and that is where Blockchain is king, through its ability to open once closed doors. Don’t be under any disillusion though, there will be corporate challenges based on the disruptive pressures Blockchain will put on global industries and those who fail to change could risk being left behind. Blockchain’s potential is essentially limitless and no one can really predict where we will end up, but I personally am going to sit back and enjoy the ride.