One of the tendencies during 2017 was bitcoin. There has been much talk about how this cryptocurrency has revolutionized the way we see the financial market. When bitcoin reached the historical value of twenty thousand dollars, several companies noticed that blockchain (a technology first described in 1991 by Stuart Haber and W. Scott Stornetta in “How to time-stamp a digital document”) could be applied to different uses in future services.
Now that you are experts on the matter, let us review a few points:
- Blocks are part of a distributed database. The content of each block can be of any type: image, video, text.
- These blocks are transmitted to different nodes (in this case, our computer, cellphone or any other device connected to the network), which then have to validate the blocks.
- Each block joins a chain in which there are other blocks that precede it and others that follow it, so they all have to “fit”. When a block is modified, it triggers (in theory) new successive estimates and validations in the others. The chain is broken when the system detects a modification that hasn’t been validated. Thus, each block maintains and validates the integrity of the others.
- Since it is a distributed database, so long as the node exists, the blockchain exists. That’s how it can achieve a high security level. The use of GIT (a version control system) or P2P networks present similar advantages.
Let us now group the different applications of blockchain in three categories:
1. Public Records
The validation of contracts and transfers of property can be done in a decentralized manner. Houses, cars and other goods can become part of a public record. Even a monetary transaction can be traceable and reported. In that way, blockchain allows us to analyze market movements, validate transactions and facilitate money tracking.
2. Workflows and Task Tracking
Companies like Walmart and IBM have begun using blockchain to manage their goods’ distribution. The system allows participants in the food supply chain to share information and track the integral progress of their products, from the farms to the stores. Since Walmart markets pork meat imported from China, which in 2008 had troubles due to the distribution of contaminated milk, they want their suppliers and users to feel confident through a public record.
3. Streaming and/or Storage Services
Any service needing a database (which is the vast majority) could be benefited by blockchain and achieve high availability. Music, video, and document applications could also benefit from a blockchain solution. Projects like Open Music Initiative and artists like Björk seek to avoid intermediaries when paying their music, video, and other suppliers. In addition, small businesses use blockchain to store information safely.
In my opinion, in order to leverage all the potential of blockchain technology, first we need to drop the concept of cryptocurrency in search for other purposes. The view we have on technology and its possible contributions to adding value for our customers, their services and, ultimately, our society is part of our identity. Analyzing, understanding and promoting the uses of a technique for goals that can be no longer lucrative is part of the essence of intive-FDV (although Sweet Fridays are also transcendental).