The world of finance is revolutionized with the entry of cryptocurrencies, where the queen is bitcoin, whose value in the market does not stop growing.
Everyone has heard the word “blockchain” before. A word that often drives people away as it remains unknown to most people. And yet, this technology does not only concern the “rich” or the “geeks”, followers of bitcoin and other cryptocurrencies. On the contrary, it concerns us all. Or at least it will very soon be the case. We have reviewed 5 everyday situations that will be disrupted by blockchain. But before that, a brief overview of what “blockchain” is and what it has as characteristics.
Definition and explanation
Blockchains make it possible to store and exchange value on the internet without a centralized intermediary. They are the technological engine of cryptocurrencies, the Decentralized Web and its result, decentralized finance. A blockchain is a database that includes the record of all exchanges between its users since its creation. This database is secured and distributed. It is shared by its various users, without mediators, which allows everyone to check the validity of the chain.
Therefore, A blockchain can be likened to a public, anonymous and tamper-proof ledger. As the mathematician Jean-Paul Delahaye writes, you have to imagine “a very large notebook, which everyone can read freely and free of charge, on which everyone can write, but which is impossible to erase and indestructible.
This process takes some time depending on the blockchain considered (about ten minutes for Bitcoin, 15 seconds for Ethereum).
Situate the blockchain
The first blockchain appeared in 2008 with the digital currency bitcoin, developed by an unknown person presenting himself under the pseudonym Satoshi Nakamoto. It is the underlying architecture.
Today there are many associated blockchains and cryptocurrencies.
Some companies sometimes consider the creation of so-called “private” blockchains, whose access and use are limited to a certain number of players. This makes it possible to experiment internally but with limits in terms of innovation (restricted ecosystem) and ROI (cost of the infrastructure to be put in place).
How does blockchain work?
Any public blockchain necessarily works with a programmable currency or token. Bitcoin is an example of a programmable currency.
Transactions made between network users are grouped into blocks. Each block is validated by network nodes called “miners”, using techniques that depend on the type of blockchain. In the Bitcoin blockchain, this technique is called “Proof-of-Work”, proof of work, and consists of solving algorithmic problems.
Once the block is validated, it is timestamped and added to the blockchain. The transaction is then visible to the receiver as well as the entire network.
Blockchain for Dummies
No need to go into technical details here. In short, the blockchain is a gigantic ledger, where all the transactions ever carried out using this technology are listed (in chronological order).
These transactions are:
- Transparent: Anyone on the network can consult them, regardless of where they are, in the same way as they can consult an Internet page
- Decentralized: Information is not stored on one server, but on hundreds of thousands of networks, all of which must be penetrated simultaneously to be hacked.
- Anonymous: the user is not identified by name but by two keys, one private and one public, necessary for each operation
In summary: traceability, decentralization, anonymity. So many characteristics that make the blockchain a revolutionary technology.
# 1 Online Payments
This is the most obvious application. Yes, if we talk about “blockchain” today, it is mainly to refer to bitcoin and other cryptocurrencies. But the use of the blockchain should quickly become widespread to secure a large part of electronic payments. It is not based, as we have said, on a centralized architecture, unlike systems like Paypal or Swift for example.
#2 Internet Comments
Rare are those now who do not read reviews on Amazon, Airbnb or even TripAdvisor before making their choice for their next purchase or their next vacation. But who tells us that these are authentic or that they have not been filtered?
With the blockchain, the question would not arise since no one can delete or even modify information without triggering a whole series of alerts. The selling point is to stand out from giants like Craigslist.
# 3 Identity documents
Reputed to be safe, the blockchain should make it possible to digitize all administrative documents (passports, identity cards, birth certificates, marriage certificates, etc.) without fear of hacking. It should also guarantee easy and low-cost access, with all data stored on a single platform, accessible from any computer.
This is also the case for the passage to the virtual ballot boxes. As we know, the idea is now widely contested, as the risk of fraud cannot be ruled out. But tomorrow, will the blockchain be a sufficient guarantee of trust to get e-voting off the ground? Some have already taken the plunge anyway. In 2014, the Danish Liberal Alliance was the first party to use blockchain to organize a vote.
#5 The Cloud
Twenty years ago we stored our data on CDs or DVDs, later replaced by USB keys. Now most of us upload our documents, photos and videos to the cloud. Therefore, On servers hosted in centralized data centres. The blockchain will decentralize the cloud. Startups are already offering their customers the “distributed cloud” formula.