At this point you must have heard read or seen something out there on Blockchain technology. I first got exposed to this about 1 year ago, and have been trying to get up to speed ever since. We are still at the initial phase of this ad therefore considered to be innovators. I estimate that within then next 2 years we will already be in the early adoption phase. I base my estimate on the fact that large corporations are now telling us through PR that they are being innovators by using/investigating blockchain technology.
In a nutshell I understand that it is an electronic ledger. The uniqueness is that it is a de-centralized ledger and therefore more transparent and secure. Blockchain technology can be used to transfer items of value (whatever they may be, you decide) in a more secure manner and without the help of a third party who charges transaction fees (currently know as Banks).
One important lesson I learned is that Blockchain is NOT Bitcoin. Bitcoin is a crypto currency that uses blockchain technology and is the first thing based on Blockchain to get global attention, therefore the confusion. However, the whole discussion on crypto currencies, regulation and safety brought in the legislators. Now, the same legislators who tried to control the development of crypto currencies (Bitcoin) are making money by having founded their own “advisory and consultancy” firms on this topic. Therefore one can argue that, perhaps with good intentions, legislators and regulators can hamper progress and innovation.
Back to Blockchain technology. As mentioned earlier, this is just a de-centralized electronic ledger. Which can be created and used for anything we can imagine. As long as you stay away from a clear monetary aspect within your blockchain, I think we can still be safe from legislators and regulators for now. The first step is to determine what it is of value that you want to exchange. This will be coded into a ledger to which everyone has access to view. And any changes will be simultaneously and visible to all parties involved. Therefore reducing the risk of fraud. One of the main ingredients is actually not digital: Trust.
this explains the basis of Trust for value and exchange, the first 18 minutes are interesting:
If we compare to what we have now, it is a promising concept, that we don’t have to pay for trust and security. For example currently we pay banks a commission to manage the exchange of our money for services. We trust the banks, yet we pay them without getting 100% certainty that they will never go bust and we lose our money.
Also the crypto currencies are based on trust. It is key that the participants of any blockchain trust each other and are in agreement of that which is being exchanged has value. Without this, the blockchain is not very powerfull. In my view the DIY sequence of developing anything with blockhain technology is:
Challenge of exchanging products/services – determining a specific item you want or need to exchange – build a Blockchain to share/transact the product against something of value
All you need is a solid definition of what it is you are going to keep track of and find a group of people that share this need and are willing/trusting to engage. Therefore this concept can be successful in any size. You don’t need large groups or global projects to apply blockchain. Although blockchain will make you large and global projects more efficient.
A definite must see if you are interested in all of the above is:
Some other interesting links: