In 2008, Satoshi Nakamoto (a pseudonym) launched a project named Bitcoin, a fully peer-to-peer digital currency system with no need for third-party involvement, like banks in the offline world. Based on blockchain technology, it was considered as a robust currency framework which could run without backing of any governments. Many tech enthusiasts dubbed this as the end of banking system as we know it. By December 2017, it reached its highest value to the US dollar with one Bitcoin esteeming $19,783.21. However, it failed to scale and become a part of mainstream economy, with its wavering values being one of the many reasons.
Bitcoin has come to represent blockchain technology, but this tech is more than just a cryptocurrency or a programming language.
Blockchain is the tech behind. Bitcoin is the manifestation of its potential.
While the future of Bitcoin in the typical world remains undetermined, the interest in its underlying mechanics, i.e. blockchain, has only gained in strength.
American companies are interested in a rendezvous with Blockchain. Investment of groups like R3 Consortium, introduction of blockchain technology by new companies like Bloq to tech-giants like IBM, indicate the promising potential of this technology. Leveraging blockchain, Facebook has announced the launch of its digital currency Libra. Firms of the likes of Circle, Bloq, Gem, and Factom are creating ready to use tools and resources which can be used by small and medium companies to integrate blockchain in their operations.
What then, is blockchain and is there a blockchain industry emerging around this tech?
In simple terms, Blockchain technology enables sharing of data without giving up control. This entails maintaining originality of the data even when it is shared with others, and thereon furthermore. Blockchain also makes it easier to track the source of any data.
This tech is often described as a giant ledger which keeps a track of who owns how much bitcoins with a unique address to each coin and each transaction. As Don & Alex Tapscott defines, it is a form of incorruptible digital ledger which can be programmed to record virtually anything of value, not just financial transactions.
What makes Blockchain special?
Its specialty comes from the virtue of a trustable ecosystem it creates. It allows users to create a reliable record of any kind of transaction, be it financial or informational. There is no need for a third-party validation on the authenticity of these transactions as this tech ensures the integrity and originality of the data.
Companies of all sizes, from startups to tech giants like IBM are going beyond the domain of finance to harness blockchain technology to revolutionize how we know IT world eCommerce, digital privacy, and cybersecurity.
The Becoming of Blockchain Industry
Silicon Valley is fascinated by the breakthroughs shown by Bitcoin. Many are aiming to recycle blockchain technology for other uses. It is expected that this tech can transform itself in a manner that an entire blockchain industry can arise from it.
- Other than the financial world, innovators are looking forward to use it in say, Digital Voting, as has been proposed by Plymouth University’s researchers.
- It is also being considered to re-decentralize the internet. This entails fusing authenticity to create mechanism for busting fake news, identity theft and re-define privacy in the digital world.
- Many startups, especially law firms, are also leveraging this technology to maintain secrecy and limit duplicity of documents even when shared with multiple stakeholders.
An Uncertain Future
Given its novelty, the underlying concept of blockchain is in flux. At this point, it represents two things—an open distributed network of the public blockchain (as currently operating in Bitcoin), and the private blockchain which companies intend to build their applications on.
Is blockchain here to stay? Just because bitcoin didn’t succeed as a currency doesn’t mean blockchain will not succeed as a technology.