Blocks and Chains excite me
Bitcoin has been a topic of popular discussion as of late, especially those within the tech crowd. It’s founder, Satoshi Nakamoto, whose real identity still remains a mystery, started this journey in 2007. Since then, it’s popularity is similar to that of a faulty elevator — sometimes it goes up, and sometimes it gets stuck on the thirty-eighth floor of a forty storey building. But perhaps it is the volatile nature of the price that entices users to invest. With a value of $200 billion, Bitcoin has the potential to stir another dot.com crash, yet the possibility for users to profit through blockchain technology is all too appealing.
Bitcoin’s success and innovation is entirely dependant on its transactions being recorded on a blockchain. Essentially, blockchain technology is a decentralised ledger that is able to confirm transactions across a peer-to-peer network without the requirement of a central certifying authority, making Bitcoin fundamentally different to all prior currencies. This offers many advantages and disadvantages:
- It’s a simple way of storing data securely which means that information that recorded yesterday is (almost) impossible to modify today.
- Transactions are consistent and transparent, guaranteeing that every user will be looking at the same thing.
- It provides anonymity for users who wish not to disclose their identities.
- There is no central organiser which cuts out the middleman and significantly reduces costs.
- However, no central organiser can prove troubling if faults in the system occur, this means there is no sole point of contact to rectify the problem.
- There is the risk of anonymity failing which could tarnish user reptuations.
- Security records will produce huge amounts of data that users will not need.
Where can we see blockchain technology going in the future?
Blockchain technology can also be implemented to various applications. For example, it can be applied to manage fractional ownership in autonomous cars. It has the potential to change the voting system whereby using a blockchain code that users can vote with through their smartphone, tablet or computer for immediate and secure results. Additionally, it could also update the current healthcare system where patients encrypted information can be shared with multiple providers without breaching privacy terms. But this is unlikely to happen any time soon due to the complex makeup of a relatively new and untested system.
One of the more promising potential applications is TV buying. The current system seems out of date but if there was to be an upgrade to a blockchain solution this could change the game. For instance, sellers would have the opportunity to list their advertising slots on the blockchain, then buyers would anonymously bid on the inventory until the time is up where only the highest bidder wins. This would not only remove the middle-men entirely but it would also allow smaller players easy access to the big pond. Nonetheless, this can only be achieved if movements from both buyers and sellers are to implement a blockchain solution which could be a long time coming.
Although Brightblue will not be implementing econometric modelling on the blockchain because it would be a solution to a problem that does not exist, we will certainly be watching. We look forward to analysing the impact of blockchain technology on industries using our tried and testing methods, but for now we’ll remain on the thirty eighth floor.