Blockchain has become something of a buzzword over the past few years, but many people remain baffled by what it is and how it works.
According to Don & Alex Tapscott, authors of the 2016 book ‘Blockchain Revolution’, blockchain is “an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value”.
Blockchain has no central authority making it completely transparent and ensuring that everyone who uses it is completely accountable for their actions on the network.
Bestselling author and TEDx speaker, Ian Khan, is a huge advocate of the benefits blockchain can have in the world of business.
“As revolutionary as it sounds, blockchain truly is a mechanism to bring everyone to the highest degree of accountability,” he said. “No more missed transactions, human or machine errors, or even an exchange that was not done with the consent of the parties involved.
“Above anything else, the most critical area where blockchain helps is to guarantee the validity of a transaction by recording it not only on a main register but a connected distributed system of registers, all of which are connected through a secure validation mechanism.”
Blockchain works on a similar basis to a spreadsheet – the information held on it exists as a shared and continually updated resource. No centralized version of the information exists, ensuring the records on it are easy to verify.
This decentralization, transparency and immutability makes blockchain a hugely useful resource within a wide variety of industries.
Read on as we look at how blockchain is changing the way we do online business.
Overstock founder backing the blockchain revolution
Overstock.com founder, Patrick M. Byrne, has been one of the biggest supporters of blockchain technology and believes it could have a huge impact in a variety of areas.
In an interview with MarketWatch, the 57-year-old claimed that blockchain has the power to transform the way citizens interact with the authorities in their respective country.
“I am focusing on the idea of building government-as-a-service, a set of applications and companies that, between them, can bring blockchain to different services that governments provide,” said Byrne. “It will make government super efficient, inexpensive and incapable of being bribed.”
Byrne highlighted Venezuela as the perfect example of how blockchain could have a major impact on how a government operates. Corruption and a financial system that is not fit for purpose have caused chaos in the South American country, but Byrne insists it could be fixed easily.
“We could step into Venezuela with six laptops and create not only a functioning society, but arguably one with the most advanced government systems in the world,” he added.
“We could bring them a central bank on the laptop. Everyone in Venezuela downloads a free app, and suddenly you have the most advanced monetary system on the planet.”
In addition to fixing broken countries, Byrne is known to have an interest in the cannabis derived products market having called on authorities earlier this year to relax the laws surrounding the industry.
His company, Medici Ventures, has claimed it aims to ‘change the world by advancing blockchain technology’ and is believed to be eager to solve the cannabis industry’s banking problems.
Producers of the best CBD oil would benefit greatly from new ways to facilitate payments and it would be no surprise to see Byrne’s company become the driving force that makes it happen.
IBM bidding to change the business landscape via blockchain
IBM is on a mission to become a leader in blockchain technology, with Statista reporting that it has tripled its number of blockchain-related patents in the last year.
They have already forged links with businesses such as Walmart, Erste Group and the Bank of Montreal with a view to revolutionising the way business is done online.
IBM has established a set of five ‘blockchain for good principles’ that demonstrate how companies and consumers can benefit from the technology.
The principles are ‘open is better’, ‘permissioned doesn’t mean private’, ‘governance is a team sport’, ‘common standards are common sense’ and ‘privacy is paramount’.
In an interview with Forbes, Jerry Cuomo, Vice President of Blockchain Technology at IBM, explained how the principles will help to change how business is done.
“It’s important to understand the power of technology,” he said. “When IBM’s CEO, Ginni Rometty, began commenting on data rights with respect to data analytics, we became inspired on the blockchain side
“Over the past three years, we have worked with many clients and have gained perspectives that have driven these principles. There are ways to use blockchain technology that are critical and would lead to good outcomes, but let’s make sure we don’t leave that to guesswork.
“That is how these five principles came about and it’s our responsibility to abide by them wisely and share them with others.”
Facebook throwing its weight behind blockchain
Facebook have been at the forefront of many technological advancements over the past few years, so it comes as no surprise that they are developing blockchain-related products.
The company recently confirmed that it will launch a global cryptocurrency called Libra in 2020, which they say will one day be able to used to pay for goods and services both online and offline.
Libra will initially be used to transfer money between individuals in developing countries who lack access to traditional banking services.
However, Facebook’s long-term aim is to create a decentralized global payment method that will replace traditional currencies.
Under the Libra Association banner, Facebook has teamed up on the project with many leading names in the financial services industry including Mastercard, Visa and PayPal.
Facebook has claimed that Libra ties in with its stated mission of ‘connecting the planet’ by allowing the 1.7 billion people who currently have no bank to access modern financial services.
Jorn Lambert, executive vice president of digital solutions at Mastercard, believes the collaboration will help to change how people across the world do business online.
“Tomorrow’s innovation may just be an idea today,” he said in a statement. “We are committed to ensuring that the ‘Internet of Everything’ comes with the inclusion of everyone.
“By activating partnerships to explore, co-create, and test new ideas, we can cultivate ideas to make inclusion a reality sooner than some may think. This effort embraces that spirit.”