A friend of mine asked “Tell me about blockchain in 2 mins”
Let me give it a go!
What is it?
Blockchain technology enables peer-to-peer transactions without an intermediary while keeping all transactions data transparent in a decentralised storage and tamper-proof manner.
- It is a foundational technology.
- It provides Internet of Value (WWW provides Internet of Information).
- It enables distribution of trust in place of traditional trusted functions.
- Data or records stored in blockchain are immutable (cannot be altered).
- Its records are traceable/audit-able from origin to end.
- Smart contract features enable the automatic triggering and execution of events when certain predefined conditions are met.
- When applied and working with other technologies, like Internet of Things, it will enable automatic governance.
Phases of blockchain
Initially, blockchain was developed to disrupt the financial sector and serve as the basis for the virtual currency such as Bitcoin. This phase of blockchain development is commonly known as “Blockchain 1.0”.
With the introduction of Smart Contracts in the next development phase, known as “Blockchain 2.0”, a number of industries are experimenting with the technology.
“A smart contract is a computer protocol intended to facilitate, verify, or enforce the negotiation or performance of a contract. Smart contracts allow to perform credible transactions without third parties. These transactions are trackable and irreversible.”
Goals of blockchain
- Censorship resistance (ie third party interference, eg internet companies )
- Fraud resistance
- Digital Assets
Listed goals are not fully achieved yet, research & development is in progress.
What it is not
- It is typically not a technology to implement within organisations, but across nations, organisations or between sectors or within a community.
- It cannot be implemented over a short period of time. Careful system and communal architectural planning is required.
- It is not a one size fits all solution.