Some of you may already be aware of this great technological advancement as a result of the rapid ascent and descent of Bitcoin. Bitcoin is based on Blockchain (or distributed ledger) technology and is probably the best-known example of a use case for Blockchain. Blockchain has many attributes that make it uniquely useful across numerous industries including: the medical profession, trade and shipping as well as finance. A block represents a new record of data. When a block is completed it is added to a chain of blocks. This is the beginning of a blockchain, which can all be accessed as part of a distributed network of computers. One may ask, who’s computers are in this network? The computers that made the blocks constitute the network. The network allows data to be transferred almost instantaneously between members of the network. For example, it can be used to trace medicines from the manufacturers to their intended recipients, creating new efficiencies within the supply chain. I believe this technology was created almost immediately following the financial crises in 2008. In November 2008, a ‘white paper’ was issued by Satoshi Nakamoto, a nefarious, possibly fictious character, about which little is known. The white paper introduced the concepts of a blockchain and bitcoin as a cryptocurrency. Blockchain technology although still believed to be in its infancy, has many applications and inventions. Blockchain has led to the development of other cryptocurrencies such as Ethereum, where developers can create the cryptocurrency and then allow businesses to use another coding language to set their own rules and policies in order to trade it. This is called a smart contract; which is more like a form of coding than a legal contract and can work in any contract that involves a buyer and a seller. Another one of Blockchain’s applications stems from the need for a digital identity in almost every single walk of life. This is when there is already a computer network in place, which is the source of all of the data, such as user attributes and credentials, but only distributed in the system by members of authority. This model is currently being developed by Microsoft and IBM. As people feel the need to control their identity and only share it with trusted parties such as Facebook Friends, it is nearly impossible to tamper with user identities or data stored with such identities. You may ask why this model is favoured so greatly? The reason for this is that the model allows users to easily access their personal data, as well as have increased privacy of their data and control of their data and preventing the widespread data hacks seen recently. For businesses using the model, it will reduce the cost of running this type of system, ease the monitoring of the system and improve the customer service and efficiency of the business operations. One of the more important applications for financial hubs around the world that Blockchain provides is that it has the ability to process transactions faster because you do not have to use any centralised infrastructure. Although there is no system secure enough to stop all cyber-attacks from happening, the widespread nature of Blockchain’s network provides unprecedented levels of trust and protection from these attacks. It also means that fraud can be much easier to stop as any user in doubt can query the data on a real-time basis. Considering that millions of transactions are now being completed every day, it is great to have this transparency. Its unchangeable (or immutable) property can be credited with creating this new-found confidence. I forecast that this technology will make the lives of many people in my community easier to manage and control. So, keep an eye out as a service or product that can change your life may indeed be coming into your lives without you realising it.
