We identify the lack of real world application in the current blockchains and cryptocurrencies because of its anonymity. In real world, companies and customers are working on visible contracts with their identities certified to make sure they keep the obligations with each other guaranteed by the Law and Government; employees use their real names and profiles to apply for job vacancies; patients use real information in hospitals and users use their real data to access applications. Because of that, there are still limitations in how blockchain can power the real life of people around the world.
“A museum exhibit of an astronaut in a full yellow space suit and helmet” by Andrew Ruiz on Unsplash
In the crypto world, in 1st generation blockchains, senders and receivers do not know much about the other side more than the amount of cryptocurrency and the time that transaction is made: A send to B an amount equivalent to X BTC at time Y. That leads to the facts that 1st gen blockchains started powering the transactions in deep (&dark) web — the anonymity is guaranteed here.
2nd generation blockchains enrich the transaction by allowing people to use smart contracts to manage the contract’s information: Why is the transaction made? What is the condition of the transaction? Example: A send X ETH to B at time Y if A and B satisfy the conditions Z. With the “Smart Contract” concept that allows users to control the transaction states, 2nd gen blockchains have been powering the starting of dApps and ICOs that are actually large combinations of complicated Smart Contracts in which many parties participate. The anonymity is still guaranteed here, and the transactions are manageable.
3rd generation blockchains try to unify the crypto world by connecting thousands of blockchains together and connect them to the real world. A can send X ETH to B at time Y and B can immediately exchange that X ETH to M EOS at time Z and send that M EOS to C at time T. The crypto world is on the way to be connected like that.
However, there is a big problem in connecting the crypto world with the real world: The nature of transactions in the crypto world is the anonymity but the transactions in real world need to be identified: from the identification of senders and receivers to the terms and conditions of the transactions. A bank in real world always require its clients to provide full information about themselves to use its service.
Then how do blockchains bring its advantages to the real world? Our answer here is KNOWCHAIN.
Original article: https://medium.com/knownetwork/knowchain-and-the-current-problems-of-crypto-world-63bd16000e10