Many of us have been in the space for a while, but it can often be difficult to find beginner guides/overviews of fundamental aspects of blockchain/crypto. I figured I would do a quick write up of the "high level" applications of blockchain technology. (Outside of currency)
Blockchain Basics
The fundamental core of blockchain technology is the introduction of distributed digital information. This is the ability to store and exchange information between users without the need for a third party to act as a “trusted’ intermediary.
Distributed information is the key foundation for building the next generation of online space. Blockchain technology serves to fix many problems we see today in and increasingly digitized and connected world.
Decentralization & Network
Blockchain technology is designed to be decentralized. This means that information in the blockchain is distributed across network of computers rather than stored in a centralized location or service. The result is a database controlled by multiple users, without a single point of failure.
Security & Transparency
All exchanges of information, or transactions, are verified by the entire blockchain network every set amount of time. Information that has been verified is set in a “block”, which is publicly accessible and incorruptible. This process makes it extremely difficult for any users to manipulate the network, and also provides an easy way for any transactions to be reviewed.
Blockchain Applications
Smart Contracts
Blockchain technology allows for the creation of programmable “contracts” which will execute when the conditions have been fulfilled.
Insurance is an industry that could be revolutionized by smart contracts. Theoretically, insurance contracts could be written into smart contracts and executed without any manual activity required. Once the conditions of the insurance have been fulfilled, the funds would be released automatically.
Intellectual property, a heavily contended and nebulous legal area in the current online space, could be simplified by building ownership rights into smart contracts. Knowing with absolute certainly who owns the copyright for something, and who deserves royalties, as well as an open verifiable ledger of these royalties, could completely change how we deal with IP.
“Internet of Things” is a concept that hinges on emerging technologies like the blockchain and smart contracts. Smart Contracts could be designed around a system such as Amazon package delivery to ensure users know exactly where their orders are, with pinpoint accuracy. Systems such as “smart home” and other environmental management tools are also clear beneficiaries of Smart Contract technology.
Identity Management
The current online world is in desperate need of a solution to deal with the problem of identity and trust between users. Blockchain allows for the development of a secure, decentralized system to identify who you are, and who you are interacting with online.
File Storage
Rather than relying on a centralized storage system, and those who control the system, Blockchain tech allows for the creation of a distributed storage system that protects files from being modified, deleted, or otherwise corrupted.
Open Economy
Traditional financial systems are an clear match for Blockchain technology, primarily around exchanges of currency, property, and shares. Purchasing and exchanging stock could be simplified to a largely user run system rather than the reliance on exchanges.
As illustrated by businesses such as AirBnB and Uber, there is a strong consumer appetite for sharing services and goods directly between users well as little intermediary actors as possible. Blockchain based platforms could essentially act as a peer-to-peer Ebay, allowing users to transfer goods and services without 3rd-party fees and management.
... and much more! We are discovering new and exciting applications for Blockchain technology every day.
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