You’ve probably heard a lot of buzzwords going around lately that may be slightly confusing blockchain, bitcoin, cryptocurrency, open ledger. These advancements in technology are revolutionizing industries and disrupting financial networks.
The short of it is that blockchain is a visible, real-time ledger for any type of record that is open to anyone in the chain. No one is in charge of the chain and every block (detail of the record) is available to those with access. Through a private key, owners gain access to blocks and can edit them—and only owners. No one else can edit your block. When a change is made, everyone’s blockchain (those within the chain) syncs automatically.
There is much more technical lingo, but this blog won’t be addressing that. If you’re in the business world, though, you need to keep your eye on blockchain news and gain some insights into what it’s all about. To that end, here are five facts everyone should know about blockchain.
1. Where It Came From & How Private It Is
The cryptocurrency Bitcoin was the first blockchain creation. After Bitcoin, people began acknowledging the underlying technological power that the blockchain possessed. So, it was separated from Bitcoin and used for many other types of inter-organizational collaboration.
Leading up to the end of 2017, more than 300 million transactions have been processed through blockchains. This equated to around US$270 billion. Even though these numbers are huge, only 0.5% of the global population uses blockchain.
Just like the internet and the intranet, blockchain can be made public or private.
2. Blockchain adoption could revolutionize the global shipping industry
Global shipping is a complicated process rife with red tape and massive amounts of paperwork. The blockchain is an opportunity for the shipping industry to cut through the methods that slow the process by making it easy for global partners to collaborate in real-time. The shipping industry, and many more like it, could see reduced costs and a better administration using blockchain.
3. Major players and investments in the blockchain
Since 2012, more than US$1 billion have been invested into blockchain companies by venture capitalists. Tech giants have also taken note of the power of blockchains. IBM and Microsoft are investing significantly into developing the technology for their own projects with IBM spending US$200 million into their blockchain projects.
4. It allows for immutable saved data
Blocks are chained together in a sequence that is looked over and approved by block owners in the network. There is no owner or organizational leader of a blockchain, and no one person or group can change or remove transactions. When the blocks are chained together, the data can not be changed. It will appear exactly as it was written.
5. The blockchain is valuable for more than just finance
The most popular use for blockchains remains cryptocurrency, but there are many more use cases that can revolutionize industries. For example, blockchains are currently being used to create digital IDs. This Microsoft initiative is meant to help those who do not have access to state- or government-issued identification. The digital ID could be used for travel, banking, and health insurance. Other use cases include:
- Better management of wireless spectrums in the U.S
- Transparency to corporate behaviors
- Real estate title storage, verification, notarization, and transfer
There is still much up in the air with all crypto currencies. Governments are trying to figure out how to regulate them and ensure their legality within the scope of the law. Investments in this technology are at a high, but so is the risk. Only time will tell whether the technology can get the traction it needs to realize its potential, but in the meantime, make sure you’re current on blockchain news. For more information, read Harvard Business Review’s A Brief History.
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