What other historical advances are similar to blockchain in terms of changing our everyday lives?

Blockchain has the potential to transform how humans transact. It is a decentralized electronic ledger system that creates a cryptographically secure and immutable record of any transaction of value, whether it be money, goods, property, work or votes. This architecture can be harnessed to facilitate peer-to-peer payments, manage records, track physical objects and transfer value via smart contracts. However, as the technology matures and its application across sectors and systems grows, there is both a challenge and an opportunity to realize blockchain’s potential – not just for finance or industry, but for people and the planet. This opportunity comes at a critical juncture in humanity’s development. As a result of the “great acceleration” in human economic activity since the mid20th century, which has yielded impressive improvements in human welfare, research from many Earth-system scientists suggests that life on land could now be entering a period of unprecedented environmental systems change

Blockchain for the Earth

The Fourth Industrial Revolution includes a new phase of blockchain-enabled innovation. The computational architecture of blockchain technology creates a wide range of potential uses. For example, by providing an immutable, distributed ledger, it can help to facilitate peer-to-peer payments, manage records, track physical objects and transfer value via smart contracts, all without a third party or manual reconciliation. During 2017 and 2018, blockchain has received considerable hype regarding its potential to create wide-reaching impact, with proponents projecting that it could account for as much as 10% of global GDP by 2025. There has also been considerable scepticism with regard to its performance and scalability that has thus far kept crypto-networks from seriously disrupting centralized systems. The challenge is to unlock the potential in a way that ensures inclusion, safety, interoperability and scale. Whether or not the technology succeeds will not be exclusively determined by its technical performance, scalability and resilience. It will also depend on the level of responsible development and adoption and will require fit-for-purpose and supportive new regulatory and legal systems, investment landscapes and societal understanding and acceptance.

Blockchain basics

Blockchain is a decentralized (distributed) electronic ledger system that records any transaction of value whether it be money, goods, property, work or votes.29 It is also an interlinked and continuously expanding list of records stored securely across a peer-to-peer network. 30 Every participant with access can simultaneously view information with no single point of failure, creating trust in the system as a whole. Each “block” is uniquely connected to the previous blocks by including the hash31 of the previous block in the new block. Digital signatures are then used to authenticate transactions. This structure means that making a change without disturbing the subsequent records in the chain is extremely difficult. These characteristics make blockchain cryptographically secure and currently tamper-proof.

Why now?

Distributed computing and cryptography have both existed for decades. However, in 2009 these ideas came together in the form of Bitcoin: a cryptocurrency network. Though initially slow to take hold, more recently there has been a proliferation of its use and a rapid increase in the number of transactions. As the world became enamoured with Bitcoin, both large corporations (first financial institutions, then others) and smaller-scale technology entrepreneurs saw a bigger picture. The underlying technology behind Bitcoin had the power to cut intermediary and reconciliation costs and revolutionize manual, frequently disjointed, opaque processes to increase their efficiency. Thus, broader ideas and conceptual applications for blockchain technology emerged.

So How can Blockchain Technology Change our life?

The social impact of blockchain technology has already begun to be realized and this may just be the tip of the iceberg. Cryptocurrencies have already provided doubts over financial services through digital wallets, the rollout of ATMs and the provision of loans and payment systems. When considering the fact that there are more than 2 billion people in the world today without a bank account, such shift is certainly a life changer and can only be a positive one. Perhaps the shift for cryptocurrencies will be easier for developing countries than the process of fiat money and credit cards. In a way, it is similar to the transformation that developing countries had with cellular phones. It was easier to acquire mass amounts of cell phones than to provide a new infrastructure for landlines phones.

Decentralizing away from governments and the control over people’s lives will likely be embraced by many and the social implications can be quite significant. One only needs to consider the spate of identity thefts that have hit the news in recent years. Handing the control of identification to the people would certainly eliminate such events and allow people to reveal information with trust.

In addition to giving the underprivileged access to banking services, greater transparency could also raise the profile and effectiveness of charities working in developing countries that fall under corrupt or manipulative governments. An increased level of trust in where the money goes and who benefits would surely lead to increased contributions and support for the needy in parts of the world that are in desperate need of aid. Ironically, and not inline with the public opinion, blockchain can built a financial system that is based on trust.