Recently, people have been talking about ‘blockchain’ like it’s bigger than world peace. They keep gushing about it everywhere and make it sound like it will solve all our problems.
The thing is, it wasn’t that long ago that people were carrying on the same way about virtual reality, augmented reality, and smartwatches.
What is preventing blockchain to end up in the same pile?
That’s a big question.
The short answer is, ‘because it’s already proving itself’. It isn’t just hype. It’s already having real-world applications. And here I’m not just talking about bitcoin. There are a lot more applications to blockchain that make it very exciting. A bit further down we’ll look at a few.
What the hell is a blockchain?
A blockchain is a way of storing information across a network of computers. Every time an action is performed – say if you buy something with bitcoin – a bit of code is added to a specific block in the blockchain. This block is then checked by the other computers in the network, who are called ‘miners’.
The reason they’re called ‘miners’ is that they’re solving difficult algorithms in order to earn credit on the chain. Once solved, the block is authenticated and can be added to the chain.
The big advantages here are:
- There is no central authority which owns the chain. The chain is spread out across the network.
- It’s transparent. The whole chain can be tracked and read by anybody anywhere.
- It’s secure. You can’t hack the chain as when you change your chain, then it will no longer match up with the rest.
Here’s a quick overview of how a simple blockchain transaction occurs:
So what can you use it for? 🤔
Obviously, you can use it as money
The reason many people prefer it to normal money is that it isn’t possible to simply print more of it on a whim. Governments do this all the time with their own money, which creates all sort of inflation problems. It is even possible for the inflation to get so bad that the currency ends up becoming worthless – something known as hyperinflation.
As nobody owns a blockchain currency, that means nobody can simply make more money, which means it’s protected from such manipulation. Of course, it doesn’t protect it from speculation like bitcoin recently experienced, but you can’t have everything.
It can be used as a ledger
Another exciting use is for bitcoin is a way to store information so that it can’t be manipulated and can’t be lost.
For example, the legal ownership of land and goods could be tracked through bitcoin. In this way, even if there was an accident that wiped out most of the network, the information would still be available – something that today wouldn’t be the case if most of the government systems blew up.
Even better, the system would make it impossible for the government to fudge documents, or ‘accidentally’ lose them it didn’t like what the documents said. In this way, they could be used to fight corruption and kleptocratic governments.
The elimination of third parties
Very often to negotiate contracts and get things done today, we employ third parties who make a lot of money negotiating such things. They will consider negotiating with officials, read reviews and understand the small print and grease the wheels.
Not only does this cost society a great deal of money, but it also means that those with the money can get things done much faster than those without. Similarly, those who know which third parties to activate have a huge advantage over those who are new to the game.
Blockchain can eliminate the need for such third parties. There is suddenly no need to employ these kinds of people as the blockchain can serve that role. Similarly, individuals can write their transaction or their contract straight into the blockchain themselves, without needing the expensive services of lawyers and officials.
This will create a far more level playing field and hugely benefit those who are not part of the inner circle.
It can aid democracy
While we’re at it, we could even use it to make sure that nobody can commit voter fraud. If countries went down the road of using something like a blockchain to register their citizens as well as their votes, it would suddenly become impossible to commit such things as ballot stuffing or any other manipulation.
Of course, a lot of governments would resist this, as it would seriously curtail their ability to decide who is let in charge, but they’d have a much harder time convincing us that they were legitimate if they did so.
The truth is we’re only getting started
Though everybody is talking about bitcoin now, the truth is that’s only a tiny part of what blockchain can do. There are so many possibilities and opportunities out there. Really we’ve only seen the beginning of something that can revolutionize technology, medicine, contracts, industry, infrastructure and more. That’s probably why so many companies are investing in the technology.
That also means that it’s hugely exciting for individuals. Because as the opportunities grow, so too will the opportunities to work in the industry.
You don’t have to be interested in blockchain currencies. You can also study the many other uses and other ways this idea can be applied and in that way find employment and a career.
Even better, as so much of it is still being shaped and the industry is so fledging there are a huge number of ideas that haven’t yet been dreamed up. That means that if you get in now, there is room for you to be the next Bill Gates or Sergey Brin. And that makes it truly exciting.
So if you want to be a part of the future, throw your self at blockchain. That’s where the future is at, even if we don’t yet know the form of it.
Written by Jessica Fender.