If you haven’t yet, you will start to hear about “The Blockchain”. In not too long, you will start to hear about it in much the same way you hear about “The Internet”. Read on if you want to learn more about this emerging technology that is ultimately going to change the way we work and communicate.
What is The Blockchain
The Blockchain started off as the technology underpinning bitcoin, which you’ve probably heard about. Bitcoin is a newly developed currency (since 2008) that you can use to buy and sell goods and services, as well as trade. The significant difference between bitcoin and every other currency that came before it is that there is no central authority in charge of it.
A Little Bit on Bitcoins
Bitcoins are traded on an “open ledger” technology, called blockchain technology, which is the type of technology used to build The Blockchain. The details of how it works are too complicated to share here (besides, I don’t even fully understand it). The significant aspect is that transactions are recorded by a network of computers that all participate in a process to agree a submitted transaction is correct. Once there is agreement, another “block” recording the transaction is added to the Blockchain. It is also important to note that any computer can participate in building the Blockchain. Compare this open network of agreement governing bitcoin to a nation’s currency that has a central bank which governs the currency.
How Blockchain Use is Growing
What is happening now is that many other types of transactions are being recorded on the Blockchain. The Economist had many articles about this recently. You can store contracts between parties, land ownership records, identity records – anything that needs to be tracked and authorized can be stored on the Blockchain. And instead of a central authority stamping the transaction (think of a deed on a house verified from the county records) it is the open ledger blockchain that is the authorizing party of the transaction.
A little more about how it works is that the servers participating in the network adding transaction blocks to the blockchain get paid in bitcoin when their block is accepted onto the blockchain. This payment is happening even for blocks on the blockchain that are recording something other than a bitcoin exchange. (Refer here for more information about how the blockchain is created).
Bitcoins are now serving the propogation of the blockchain, in all the multitude ways the blockchain is being used and will be used. Whereas when it was first released in 2008, it was the blockchain that was serving the ability to trade bitcoins.
Towards Blockchain Ubiquity
The chief of the US SEC made public comments about the blockchain and blockchain technology just a few days ago. You can read about it here. Note that she does not mention bitcoin at all. It is the blockchain that is the significant force at play.
The blockchain will become an integral part of where we store and retrieve information, information that will power how we work together and communicate. Think of a disagreement where two people have different records of what happened, and you consult the Blockchain to settle the difference. Think of automated processing on a given event, like when a death is recorded in the blockchain, the execution of the deceased’s will is triggered (this is already happening).
Once you start learning about this, it doesn’t take a lot of imagination to see how “The Blockchain” will become as ubiquitous as “The Internet”.
If you want more in depth information about this exciting space, there are a lot of articles being written. Here are just a few:
On the business and social implications: Forbes: Blockchain Will Break Free From Bitcoin to Power Distributed Apps
How the technology works and can disrupt: The Blockchain is the New Database, Get Ready to Rewrite Everything