You may not have heard about blockchain until today, and if you haven’t, you will be sure to encounter it again and again after reading this article. It seems to be the word on the tip of everyone’s tongue at the moment. Especially those who work in tech, retail, logistics, finance and real estate.
Blockchain is often confused with Bitcoin. Please note: blockchain is the technology that Bitcoin was built on, and was the first application of blockchain. And we are now seeing blockchain being used across many other industries, and is providing opportunities for disruption in sectors such as finance, real estate, retail and Government.
So what is blockchain? And what are the features that make it so unique and a “game changer”?
Blockchain is a database or a ledger that maintains a continuously growing list of data, records, or transactions. Think of it like an Excel spreadsheet with some unique features that make it much better than a traditional database.
Shared Publicly: Computer servers manage the entries on the ledger. The entries are referred to as ‘blocks’. Every individual server on the network sees every transaction block when it is created.
Decentralised: In blockchain technology, there is no central authority required to approve transactions.
Secure: A blockchain database cannot be changed or reversed. Entries into the ledger cannot be tampered or modified – even administrators can override this feature.
Trusted: Because a blockchain database is distributed across a network of computer servers, each one needs to approve for a transaction to happen between 2 or more unknown parties.
So what is all the fuss, and why does this technology have the power to disrupt many industries? Well, one of the main factors is that because of the transparency that comes with moving the trust and authority to a distributed group, or network, as opposed to, in finance, for example, being with one powerful, and central entity (e.g. a bank).
It may take some years for this peer-to-peer technology to take hold in the mainstream here in Australia. However, we are already seeing applications emerging in small start-up companies, and the big 4 are making moves into this space now, most likely in order to avoid another AirBnB vs. Hotel industry or a Uber vs. Taxi Industry situation.
Watch this space.