The biggest revolution after electricity and internet…
We’ve probably all heard of Bitcoin, Ethereum and other
cryptocurrencies recently, but do we really fully understand the underlying and
disruptive technology that they rely on? In this article we will talk about the
future of trust: Blockchain!
Back to 1982 and a brief history of blockchain
Following the global financial crisis of 2008, an
unknown person or group of people using the name Satoshi Nakamoto created an unprecedented document: A
peer-to-peer electronic cash system. The first conception of decentralized
blockchain was based on this innovative and enhanced design. The terms block
and chain were used independently in Nakamoto’s original paper until 2016, when
they were merged into one phrase, blockchain. And this fueled a complete new
era in technology and probably the most significant revolution after
electricity and internet...
The technology
adoption curve of crypto users vs. total worldwide internet users is depicted
in the diagram above. Crypto has a far faster adoption rate than the Internet,
with an average annual growth rate of 80%.
What if we try to sum up blockchain in a single
sentence?
“Blockchain
is a decentralized, distributed, continually updated and immutable ledger that
records the history of transactions in a chronological order.”
So what is blockchain and why is it so unique?
Let’s
start with the structure of the name:
Block: the
file is made up of data blocks + Chain: each block is connected
to the previous block, forming a chain.
Blocks store the hashed and encoded records of valid
transactions in a hash tree. A hash is a string of letters and numbers, that
serves as an unique fingerprint for every block in the blockchain. The blockchain
is made up of a sequence of blocks, each of which contains the hash of the
previous block. This repeated process is performed to ensure the integrity of
the prior block to the genesis block, which is the first block.
When a transaction in a block changes, the block's
hash changes as well. When the block's hash changes, the next block displays a discrepancy
with the previous hash it stored. As a result, blockchain has the distinct characteristics
of being tamper-proof.
The blockchain stores data in a huge network of
computers known as nodes, each of which has a copy of the blockchain. Every
time a new block of transactions is added to the network, all members must
check and verify that all transactions in the block are genuine. The new block
can only be added to each node's blockchain when it has been approved by all
nodes in the network. This process is called consensus.
To summarize, anyone attempting to attack or edit data
on a blockchain must change the majority of computers in the network, which is
how blockchain functions as a highly secure data storage technology.
To summarize, here are some key points!
Blockchain is:
- Distributed
because it is a massive global spreadsheet that operates on
millions of computers.
- Open
source because it’s published transparently and it’s not owned by
any company, institution or individual.
- Peer-to-peer
because it does not require intermediaries to validate or
settle transactions, which makes blockchain a viable solution to the problem of
insecurity and exploitation by central authorities, platforms and
organizations.
Without
a question, blockchain technology’s core and unique characteristics may be
applied to a variety of industries, creating new potential opportunities for
the future.
Here
are some examples of real-world blockchain use cases that can be applicable for
enterprises, institutions, and governments:
- Payment
Systems & Cryptocurrencies
- Cyber Security
- Supply
Chain Management
- Advertising
Insights
- Networking
& IoT Operating Systems
- Insurance
- Private
Transportation & Car Sharing
- Online Data
Storage
- Charity
Ecosystem
- Voting Mechanism
- Secure Sharing
of Medical Data
- Music Royalties
Tracking
- Retail
Industry
- Real Estate
Industry
- NFT Marketplaces
In the
next articles, we’ll go through in depth how above-mentioned blockchain use
cases will reshape the future in numerous industries. Don’t miss it!