No doubt about it: It is Bitcoin, not the bird, that is the word for 2017. Investors, analysts, brokers and bloggers alike are testing the waters and getting their cyber-feet wet. However, look past the glitz and glimmer of Bitcoin and see the reason for the season’s runaway success – blockchain technology it rides on. Blockchain, unlike Bitcoin which is a commodity, is a process with a myriad of applications. While the media feeds frenetically on Bitcoin’s ever changing valuation, major players are, instead, looking to adopt blockchain technology. Even Mastercard is vying for a blockchain based patent. If that isn’t the smoking gun for a shot at widespread adoption, what is?
Almost overly simplistic, the word blockchain is the definition of the technology: a chain of blocks of information. The information is transaction data that takes place directly from one person to another. The transaction is broadcast publically to a system of computers, called nodes, for the public to see and therefor hold true. The transaction is assigned a unique nonce, timestamped and cross-referenced to all previous transactions in existence. Upon completion, the recorded transaction joins its brethren in its respective linear-time-based block of transactions. Once a block reaches its transaction data maximum, it is added to the previous chain of information blocks. Thus the blockchain is born.
Virtually indelible, the information in each block will remain unchangeable and honest for eternity. Each new block creates another level of security by means of increasing computational difficulty for corrupting attackers. So long as the majority of the nodes are honest, or at least indifferent, fraud becomes difficult to the point of devaluation and deterrence. This secure appeal is one of the driving factors in blockchain’s widening adoption by some of finances biggest and brightest.
Blockchain’s Big Break
Despite its simultaneous and equally clandestined debut, blockchain technology has not garnered the same market hype as Bitcoin. Nevertheless, adoption and application of blockchains are becoming far more widespread. Case in point, credit card giant Mastercard’s U.S. patent application. The abstract details a proprietary blockchain-style, algorithm-based payment processing system. Ironically enough, this move comes as Mastercard CEO outwardly denounces Bitcoin. Secured and guaranteed by the ledger data stored within the algorithm, MC’s technology boasts instant payments with reduced fraud potential. Sound familiar? The concept is Bitcoin’s genius. Patent pending status aside, this is just one example of how blockchain’s truly remarkable technology is already a permanent asset in our global financial structure.
Fueling the Future
Beyond financial institutions – government entities are now looking to blockchain as an IT solution. The Pentagon, NATO, DARPA and the Foundation for Defense Democracies are now calling for adoption of blockchain technology. The intrinsic security and instant exchange capability makes blockchain technology extremely appealing for classified combat missions. Implementation for such tech in sensitive combat situations is potentially life saving.
On the humanitarian front, the UNWFP in conjunction with Ethereum cofounder are using blockchain technology to help Syrian refugees buy food and basic amenities. Refugees receive cyber coins directly to their “wallets” providing them with purchasing power that would otherwise have been unattainable do to their status. Furthermore, there are now ICOs specializing in monetary relief efforts. Utilizing blockchain technology allows individuals to send funds to places like Sub-Saharan Africa without the current costly . Tragically, the cost of sending money to African, third world countries is the most expensive, deterring potential relief efforts. Blockchain technology now alleviates the current onerous rigamarole of sending aid.
Regardless of the bickering views of the cyber currency craze, its time to give credit where due. Dismissing the ingenuity and potential of blockchain technology is downright alarming, if not utterly disrespectful of innovation and positive progress. Blockchain technology increases efficiency, mobility and security while decreasing transaction overhead and the potential for corruption and fraud. If these are not at a company’s core structure, perhaps a deeper look into the company’s mission is due.