Explaining Blockchain to the Masses
As we start the second half of 2018, blockchain continues gaining momentum with numerous companies and fintech groups who are exploring applications that can take advantage of its innovative benefits in disrupting existing processes / structures. Despite the increasing levels of awareness with this new technology, industry insiders still have difficulty explaining to the general public what blockchain is and what potential it has, making it difficult to build belief for the masses.
No matter the level of expertise or experience, the majority of discussions about blockchain should provide some insight on the following features that give the new technology a powerful and compelling value proposition:
Immutable - transactions can’t be edited (once they are validated);
Encrypted - cryptographic hashes increase the security of each transaction;
Pseudonymous - Only the basic information required to identify a posted transaction is viewable to the public;
Decentralized - No central authority needed as data sits across every node in the blockchain, which also makes the whole platform highly resilient in the event a node (or nodes) fails;
Consensus-based - agreement by the majority (of blockchain’s nodes) must be reached before a transaction is validated;.
Time-stamped - ensures validated transactions are not duplicated.
To sum it up without getting inundated on industry jargon:
Blockchain is a distributed database (ledger technology) networked through multiple computers (nodes) without a need for a governing authority (decentralized) due to new records posting (in blocks) only after a majority agreement (consensus) is reached within the network, with links (chain) between records in chronological order (timestamped) which are permanent (immutable) and highly secure (encrypted) only showing necessary tracking information (pseudonymous).
No one explanation or summary is perfect when it comes to blockchain, but a core discussion should highlight the enormous potential of this new technology when appropriately applied to the proper business cases.
Thanks for reading! Here are some other articles on blockchain for you to check out.
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Article - Enterpriser