After talking to many professionals in Tech field, visiting several related events and a deep personal research, Improve Advisors came to the conclusion, that Blockchain is indeed the next Internet! In our century it will have as huge transformative impact on our society, government, health, commerce, and so on, as the World Wide Web has had.
Many people and companies still don’t really understand what Blockchain is, or the potential of what can it do, which means significant barriers to mainstream adoption. Though they may have heard about Bitcoin or other Cryptocurrencies, and even accepting them as a form of payment, they might still not really understand how exactly does it work from technological point of view, or what else it is capable of achieving, how many things to change…
The first step towards this understanding is comprehending and demystifying the differences between the technology of Blockchain itself with its endless possibilities, and the digital currencies (Bitcoin,Ethereum, other Altcoins…).
In our articles, we will be guiding you step by step into the Blockchain Technology going deeper into its essence.
So is Blockchain – the biggest revolution we will see in our lives?
Blockchain as a technology is a decentralized public ledger, that uses code across multiple computers, which reach consensus on a transaction and record it in an immutable log, it is essentially a distributed database that allows potentially complex trust relationships between database users. It works via a distributed network of nodes and users to move any ‘digitalized’ asset from peer to peer P2P and validation is done by the majority of nodes (‘mining’; consensus algorithms). By design, it doesn’t require any authority or facilitator to authenticate or to settle and confirm transactions. In essence, the primary question driving Blockchain technology is:
‘Do I trust enough the data I am using? Can I rely on it to evaluate my own risk?’
Why is Blockchain considered to be the most secure ledger system in history?
Its concept is very simple: a record book that everyone can see, and no one can alter. Many copies of this record book are distributed (often globally). New information is added to a blockchain only after a consensus is reached between a majority of parties who hold copies.
This simple innovation allows transactions between individuals without the mediation of a third party.
This power will bring crucial changes to the relationships between people, businesses, and government. Many intermediaries, such as lawyers, asset managers, accountants, supply chain controllers, record keepers, will find their roles changed or swept aside when Smart Contracts, the self-executable and automated computer programs that can carry out the terms of a contract or a business agreement between two or more parties, will gain global usage.
The primary challenge to the adoption of this technology for the FinTech sector is the fact that Blockchain is still nascent, largely unregulated and lacking standardization, and there are some factors and vulnerabilities yet unknown. But these won’t stop it from being widely adopted!
Trust will be growing, regulations will be performed and standards will be adopted. Radical changes will occur over the next few years that will shape the way Blockchain is applied in the financial industry and also make it easier to implement.
In our next 2 articles, we will get deeper into the subject of Smart Contracts & Oracle, specify the areas where Blockchain technology bring the opportunities, and which threats may be hidden behind it.