So, what is the Blockchain technology? The technology that underpins Bitcoin, known as Blockchain, might well be the greatest innovation of the past 10 years. Too often, Bitcoin is seen as just the latest in a long line of fintech entering the market but upon closer inspection, perhaps it’s time to view it as era-defining technology with the potential to disrupt far more than just finance.
Blockchain, it emerges, has many important applications outside of just Bitcoin. These applications are in areas as diverse as helping with trading carbon emissions to the maintenance of sophisticated health records. All of this emerged at a recent conference held at the MIT Media Lab organized by the MIT Technology Review.
One of the speakers at the conference, Brian Behlendorf, an executive director of Hyperledger, an open-source platform which is developing various applications based on blockchain technologies, said: “This is an opportunity to reinvent how much of the world works,” before noting: “This isn’t just about finance.”
Blockchain is a cryptographically signed ledger that makes it possible track and verify payments without any centralized authority (a central bank in the case of fiat currency transactions). This ledger, which is maintained by computers, can also be used to verify all sorts of other complex interactions between different pieces of data.
Industries currently being disrupted by blockchain include cybersecurity, elections and voting, analytics for forecasting, transaction-based real estate and even the diamond industry, which is looking to use blockchain technology to identify suspect diamonds and fraudulent transactions – notoriously common in diamond trading until now. 256
It is still early days, however. While blockchain is undoubtedly an outstanding innovation, it is important to remember that it is still first generation. As Behlendorf warned at the conference: “there are over-inflating expectations right now.” Even after saying that, he admitted to being bullish on the prospects for both blockchain, saying it could be “transformational.” Most encouraging of all for traders of Bitcoin is that it is right at the center of this transformation.