The Future of Blockchain and Beyond
The misconceptions, benefits, and future of Blockchain technology
The rise of the cryptocurrency Bitcoin in recent years has put the Blockchain into public consciousness. Touted as the Web 3.0, today’s tech leaders anticipate that Blockchain disruption will be similar to the growth and maturity of the internet in the 1990s.
But what is the Blockchain and how does it work?
The Blockchain is the underlying technology that fuels cryptocurrencies like Bitcoin. It is a data ledger of transactions that are immutable, transparent, and not owned or controlled by one central entity.
The Blockchain works through a collection of data into a decentralised block (users or nodes) and then verified by dedicated mechanisms (such as Bitcoin miners). Once a transaction is verified as valid, the transaction is then stored in a public ledger. Once part of the Blockchain, information can no longer be changed.
It is not unusual to directly associate Blockchain technology to Bitcoin, with its public debut being in Satoshi Nakamoto’s white paper about the peer-to-peer electronic cash system back in 2008. Despite this, it wasn’t until 2014 when companies started to explore the use of Blockchain beyond the world of Bitcoin and cryptocurrency.
As the Blockchain is a public, open ledger of transactions between two parties that cannot be removed or edited, it is also unnecessary to require third parties for authentication. Thus, this feature of the Blockchain gave rise to distributed ledger technologies that can have many uses cases and applications across all industries.
Misconceptions about the Blockchain
Blockchain technology is relatively new, in comparison to other technologies at just over a decade old, and has only recently branched further than the world of cryptocurrency. As with all technology that is yet to mature, there is still plenty to discover and improve upon when it comes to the Blockchain.
Some of the Blockchain’s misconceptions stem from its association with Bitcoin, but in truth, Bitcoin is only one application of the many uses of this emerging technology. While cryptocurrencies are infamously volatile, the Blockchain has the potential to mature into a useful, secure, and versatile underlying technology.
At this point in time, the Blockchain and underlying technology that uses the Blockchain may be subject to vulnerabilities but through design — its application can become clear, trustworthy, and robust.
Many of the misconceptions and negative connotations in relation to the Blockchain has stemmed from the novelty of the technology. The more we see industries and applications use the Blockchain in more developed and sophisticated ways, the quicker the disadvantages will outweigh its benefits.
The Benefits of Blockchain
No one company, government, or entity owns and controls the Blockchain. All the participants in the network are responsible for the design of the chain. This feature of the Blockchain, therefore, enables transparency and openness. All transactions on the Blockchain are publicly available and can be accessed without the need of a third party.
Immutability, or the ability to remain unchanged, means the Blockchain can contain multiple mechanisms that verify each transaction before they are added to the chain. This feature of the Blockchain is useful because systems that continuously check the chain for consistency virtually reduces the high risk of hacks and tampering.
Fosters digital trust
With everyone having access to immutable transactions, the Blockchain also reduces time and resources spent on manual verification of data and information. Every person and transaction on the Blockchain can trust that transactions are verified and open. This, therefore, removes the need to trust other parties, instead, people can place their trust the data of the Blockchain.
With digital trust between two parties and direct cooperation, the Blockchain removes the for third parties, thus removing redundant and unnecessary ‘middlemen’ and reducing costs of performing transactions.
Greater control of digital data
With the encryption of sensitive information, but the option to have control and access to transactional data to all users, the Blockchain enables people to be more informed. Individual users are thus able to safeguard their personal and private data more effectively.
Improves technological reliability
The transparency of the digital ledger of the Blockchain makes data more reliable, reducing risks of security breaches which may overall improve the efficiency of institutions.
Blockchain in Today’s Technology
While the Blockchain is projected to grow to an incredible scale in the coming years, it is a technology that has real-world applications beyond cryptocurrencies. Many governments and private institutions are already investing plenty into adopting the Blockchain as its underlying technology across multiple industries.
Cryptocurrencies in developing nations.
Zimbabweans turned to Bitcoin to aid in the overinflation of their dollar. Venezuela has developed its own cryptocurrency called the ‘petro’. With developing technologies that already exist to ensure transactional integrity for the Blockchains and cryptocurrencies, an official cryptocurrency using the Blockchain is definitely a future possibility.
Distributed Ledger Technology (DLT)-based government systems
Dubai has started to shift towards DLT-based systems as a transparent and immutable way to digitise their government data. Projecting a complete shift by 2020, it won’t be a surprise if other nations follow suit in its footsteps.
Hospitals are making the move to use of the Blockchain to aid in integrated care, enabling doctors to see full and accurate medical histories thanks to the Blockchain’s transparency and immutability. The Blockchain has also assisted in medical research, giving medical professionals and researchers access to centralised patient data while ensuring individual anonymity for all parties. Currently, the Blockchain is already a US $178 million technology just for healthcare alone and is projected to increase to over US $5 billion in the next six years.
Blockchain-based voting systems are already in place in Switzerland, where smart contracts are used to ensure ballots cannot be tampered with. Voters are verified to make sure multiple votes to one person are eradicated, and results are publicly accessible and accurate, reducing and preventing voter fraud.
Other industries from education and agriculture to shipping and supply chains are starting to explore the Blockchain to improve their systems and processes.
Blockchain and the Future
The way we manage and distribute data will continue to shift and be a pivotal centre of technological progress, and the Blockchain offers an option to decentralise data out of silos. The Blockchain will transact in ways that will bolster transparency, cooperation, and ultimately, trust.
The Blockchain will be a gamechanger in fields such as security, contracts, and identity verification. Blockchain-based digital passports with biometric identity verification are just a step into the future and will make travel seamless and airport processes quick and smooth. Travellers will always have access to their travel and personal information that is easily verifiable by airport counters, security, and even hotels.
People may be able to gain greater control over their digital identities, no longer hidden behind private corporations.
The Blockchain can help unlock a future with increased transparency and streamlined processes in bureaucratic matters. Government corruption may be decreased, identity theft may be eradicated, and identity systems may become more universal, eliminating disenfranchisement of people who have no legal documentation.
This technology can also greatly improve the global supply chain, making information and process more transparent and accessible, reducing instances of fake products like medicine, medical equipment, even luxury goods. The possibilities are endless, and we’ve only scratched the surface.