What is Blockchain Technology and Where is it Used Right Now?

Blockchain technology is silently revolutionizing the world around us and forward thinking organizations are integrating the technology into their daily operations. The system was originally created to bring forward a network of digital property free from centralized control that accurately kept track of ownership.

A Digital Ledger

The creation of Bitcoin in 2009 also saw the popularization of blockchain technology when the mysterious Satoshi Nakamoto devised a decentralized digital ledger that accurately kept track of every transaction made, and contained a guarantee of integrity throughout the entire network.

Nakamoto outlined a consensus network that would enable the new form of digital money to work with a decentralized peer-to-peer payment network being powered by its users. The system essentially works by getting computers to spend energy proving that they are trustworthy, and stamping that trust on the “blocks” of recorded transactions. Trying to falsify or alter any unit of information on the blockchain would require an enormous amount of computing power to try and override the entire network.

By allowing digital information to be distributed but not copied, blockchain technology created the foundation of a new type of internet that the world’s tech community are now finding other potential uses.

As Don & Alex Tapscott, authors of Blockchain Revolution stated, “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”

Early Adopters

In May last year New York’s NASDAQ announced that it was exploring the potential of using blockchain technology. Bob Greifeld, the head of NASDAQ went onto state “Utilizing the blockchain is a natural digital evolution for managing physical securities. Once you cut the apron strings of need for the physical, the opportunities we can envision blockchain providing stand to benefit not only our clients, but the broader global capital markets.” True to form, NASDAQ has rolled out the NASDAQ’s Linq, a blockchain enabled platform for private market trading.

The world of finance has been quick to assimilate blockchain technologies with various stock and commodities exchanges preparing blockchain applications for their services. These include the Australian Securities Exchange (ASX), the Deutsche Börse and the Japan Exchange Group (JPX).

Smart Contracts

Blockchain technology has already evolved into something new in that there are many blockchains, as companies operate with different needs and require specific solutions. Ethereum has stepped forward to provide a versatile platform that offers a new range of solutions.

Created by Vitalik Buterin in 2013, the Ethereum network allows users to create “smart contracts” that can be executed by any computer running the Ethereum software in exchange for the network’s own currency, ether. The Ethereum network has the ability to realize the potential of blockchains on a world-changing scale with smart contracts opening up a range of possibilities in sectors including the world of law, the music industry, and the real estate business.

The opportunities for development are endless with the following sectors all-moving towards integrating blockchains:

Crowdfunding

File Storage

Identity Management

Intellectual Property Protection

Sports Betting

Online Gaming

Blockchain technology is set to become a fixture of modern life with companies such as Storj (a file management operation), Civic (identity management), and Mycelia (music distribution) all utilizing the blockchain. The number of organizations running blockchain based operations looks set to continue long into the future.