What’s so special about blockchain technology?
On revolutions, the Facebook scandal and the missing piece of the Internet.
Revolutions tend to be rather chaotic affairs. Just take the French Revolution for instance. Brutal, savage and frankly, quite poorly organised.
Technological revolutions tend to involve a little less gunpowder, and give somewhat less importance to chopping peoples’ heads off — at least in the literal sense. Their overall effect, however, can be just as inescapably significant and, well, revolutionary.
Blockchain’s potential for widespread, pervasive change is often compared to that of the Internet. In fact it’s often referred to it as ‘the New Internet’.
I won’t be burrowing into the Internet vs. blockchain debate in this post, but if you thought comparing civil revolutions to technological revolutions was in any way shallow, take a moment to appreciate the device you’re reading this on, what it represents, and how the internet has sculpted the world we live in, in just two decades.
With that in mind, I think it’s fair to say that the prospect of another technological revolution should not be taken lightly. Yet, in comparison to what many of us expect the long term effects of blockchain to be, crypto-craziness of the past months aside — the blockchain revolution is still very much in its infancy.
To many, the blockchain space may seem like an over-hyped circus of buzzwords and libertarian nonsense, and that wouldn’t be completely unfounded. A lot of what we’ve seen so far has in fact been hot air.
After all, it’s not the first time the word ‘revolutionary’ has been tossed around the tech world. We’ve been through this before. Headlines about how the likes of Google Glasses will be the breakthrough we’ve all been waiting for, or how Facial Recognition will completely redefine what it means to be human, have been all too common over recent years.
Just take a look at this Google Trends graph comparing use of the word ‘revolutionary’ with more down-to-earth alternatives like ‘exciting’ or ‘impressive’ over the past five years. Now I might not have been paying close enough attention or I just can’t spot a revolution when I see one, but I get the feeling it might be slightly overused.
The complexity behind blockchain doesn’t help its cause. It’s easy to get tangled in the nitty-gritty details underlying the technology and lose track of its scope, not to mention its potential for radical change.
Nevertheless, to quote Theodore Roosevelt completely out of context, ‘nothing in the world is worth having or worth doing unless it means effort, pain and difficulty’.
So, without causing you too much pain or difficulty — what’s so special about blockchain technology?
The components of this technological breakthrough are special in their own right, but not entirely new. Hash rates, encryption and P2P networks have been around for many years, as has the idea of decentralization.
When fused together, however, they take on a new shape, with entirely different properties — and its potential for wide-spread change on a fundamental level should not be underestimated.
A race is underway. A race to bring this new technology to the masses and be the first to really set the revolution in motion. Every day, new use cases are being envisioned and put to the test. It’s becoming clearer and clearer that no stone will be left unturned by blockchain. Finance, supply-chain, mobility, health, entertainment and even government, will reap the benefits of the distributed ledger.
Type in adssettings.google.com in the address bar at the top of your screen. You’ll be directed to the Google Ads page, where you’ll find a list of topics Google thinks you like and don’t like, along with your gender and age.
Now head over to myactivity.google.com, where you’ll find a comprehensive list of everything you’ve ever searched for online.
Here’s a fun one — type in google.com/maps/timeline. This will give you a history of everywhere you’ve ever been over the past few years. Every time you went to work and every time you got home, the roads you took to get there and how long it took.
Every time you visited your family, every coffeeshop, restaurant and grocery store. Every festival, pub or strip club. All over the world. With pinpoint accuracy, down to the last second.
Feeling watched yet?
Collecting data in-and-of-itself is not a bad thing. It can actually be used for all kinds of good. I personally like the idea of a journal tracking my online activity, and I think a round up of everywhere I’ve been each month is a nice idea.
The problem? Data nowadays is collected, stored and used by big corporates and governments in all sorts of far-from-pleasant ways. There’s the very real possibility of that data — our most intimate information — being hacked. There’s also potential for mismanagement of the information or for unethical use of it. Not to mention it being a blatant disregard for peoples’ privacy.
Technically, you signed up for this. Remember ticking that ‘I agree’ box? Nobody does. But what it basically offers is either 1) tick the box and comply to whatever’s in the T&Cs, or 2) don’t tick it and don’t form part of the modern digital world. There are no alternatives, no middle-grounds.
What if you didn’t have to make that choice, though? What if you could maintain the benefits of having your data collected and analysed, without having to trust someone with it?
You guessed it — blockchain.
blockchain makes it possible to store and send value in the digital world without having to trust a central authority or third party. Information is distributed among all network participants, rather than controlled by an intermediary or organization.
The responsibility to maintain and validate data is left in the hands of the users, and the result is a hack-proof, transparent, immutable, incorruptible, system of data registry.
In the case of data privacy online, blockchain can make it possible to have your data secured over a distributed network, rather than a hackable, corruptible central authority.
But what about the digital breadcrumbs we leave behind, the stuff organizations use for tracking and surveillance? Having a distributed server hides these breadcrumbs. In fact, it doesn’t drop any to begin with. Take that, Zuckerberg.
The power of blockchain isn’t reserved for the data market. It wouldn’t be cause for a revolution if it didn’t have the potential to permeate every nook and cranny of our society. You may recall it originally took off through the digital currency, Bitcoin. Bitcoin was initially created as a decentralized peer-to-peer cash system. A dollar with no FED. A euro with no ECB.
Indeed, blockchain can be used just about anywhere. It could be used to ensure the cobalt used to build your smartphone isn’t the product of a Congolese four-year-old’s work. It could allow musicians to be paid exactly as much as they’re owed for their work by not having to go through a middleman. It might even make voter fraud an impossibility.
I should reiterate the fact that it’s still early days and that precise predictions of exactly how and what it will effect are difficult to make.
In theory, at least, virtually any system which requires a third party, an agent or a middleman, is in the blockchain firing-line, as is anything that requires indisputable proof or trust.
A single, digital version of the truth
Decentralization is undoubtedly a breakthrough of colossal proportions, but it’s not the only special aspect to blockchain. Part of what makes this system so powerful, and part of what makes digital decentralization possible in the first place, is the fact that for the first time, information and value can be distributed around the world, without the risk of it being copied, forged or tampered with.
This is a vital feature for decentralization to work as having no central authority would bring up the question of authenticity. The verifiable, immutable nature of blockchain makes authenticity an in-built feature.
This has profound consequences on the digital world and beyond. Since the dawn of the Internet, and especially over the past few years, we’ve been navigating a labyrinth of fake news and half-truths. We simply could not verify where information was coming from and if who said it was who they said they were.
Blockchain is that missing building block of the Internet — the trust protocol. It gives us a way to be sure of our information and data, such that we can now think in terms of adding our identities to blockchains to eliminate the possibility of all kinds of fraud, write self-executing smart contracts in computer code or send value of all kinds directly to one another.
This is where the idea of blockchain as the ‘New Internet’ comes from. The addition of a trust layer, of a consensus feature, represents a whole new way of interacting online. Given how pervasive the Internet has been beyond the Internet connection, one would not be blamed for thinking that the New Internet might do the same — that the trust protocol may change the way we interact on a fundamental level.
The French Revolution was about the people’s cry for freedom. Freedom from a system they no longer believed in, freedom from economical and political mismanagement by the few whose job it was to safeguard the stability and prosperity of the many.
Five hundred years later, the blockchain revolution was forged in the depths of a global financial crisis, as the byproduct of a fusion between libertarianism, technology and a cry for decentralization. It too was born from a lack of trust in the powers that be and the need for a better system.
Blockchain promises a very different kind of freedom under very different circumstances — but freedom nonetheless.