The future of blockchain technology is bright. Distributed blockchain technology is already disrupting the way we buy and sell goods and services, but there’s more to come. Trading Bitcoin was only the beginning of a bright new future in how the world transacts and trades.
What is blockchain technology?
Blockchain is a distributed ledger in which Blocks hold batches of valid transactions. Once a block is complete, it gets added onto a chain where previous blocks exist and can be traced back in time, creating a so-called “chain” of blocks-hence the name blockchain.
What does it do?
Blockchain technology allows parties that have no pre-existing trust to share information without going through a third party. It can be used to build decentralised applications (Dapps) and cryptocurrencies.
What’s the difference between public and private blockchains?
Public blockchains: Anyone who wants to use, buy or sell cryptocurrency in a public blockchain can do so. Bitcoin is a public blockchain that is entirely open, and anyone can join it. There are also specific types of cryptocurrencies that have been developed for this type of application, such as Ethereum.
Private blockchains: These sorts of blockchains require permission from a central authority before access is granted. Examples include Ripple and Hyper ledger Fabric. In these instances, an organisation may choose to create its own “private” distributed ledger technology, which gives it complete control over all aspects of the networks.
A Gartner report predicts that blockchain will generate an annual business value exceeding $3 trillion by 2030. Here’s a summary of what you need to know about the technology today, according to TechNavio analysts.
The future of blockchain technology: why it matters
Blockchain technology underpins cryptocurrencies, such as Bitcoin and Ethereum. Hence, it allows people to secure a safe digital money transfer without a third party like a bank. But the potential of this new technology goes beyond just currencies and could transform many other areas, including government, law and even global supply chains.
But while some experts predict that widespread use of blockchain will happen within years or even months, others believe we won’t see mass adoption until the next decade.
Blockchain technology enables a shared ledger that records transactions between parties, requiring no intermediary party to approve or verify those transactions. It allows even trade newbies to trade directly for goods and services, from financial exchanges to insurance premiums and new kinds of markets. It also increases transparency because all the parties involved can see the transaction data on the ledger. In addition, it offers increased security because there is little risk that information will be hacked since details are not held in anyone’s central location.
The future of blockchain technology: the challenges
Like the internet, blockchain has both supporters and critics who question whether businesses should adopt this technology. However, blockchain technology is still changing. There are concerns about scalability, standardisation and cost, and many argue that it needs to overcome some critical challenges before mass adoption occurs.
What does this mean for business leaders? While the potential of blockchain is clear, there’s a lot of debate about how we’ll get there and what it will ultimately look like. It could be an evolutionary process with incremental changes or something more disruptive where current processes or entire industry sectors disappear entirely. Either way, companies need to consider now embracing these transformative technologies, so they don’t get left behind.
The first use case for blockchain occurred when Bitcoin invented the cryptocurrency. Since then, this innovative technology has found many more uses. Though it’s still early days, major industries are already looking closely at leveraging the benefits of blockchain.
Anyone can join: Blockchain networks do not require any permission or central authority to join. It allows the participants of a blockchain network to control their transactions without any third-party interference.