By Jairo Carbonell
The blockchain is a public distributed ledger and it is revolutionizing the way we do finance by creating trust with emerging technologies. Bitcoin was the first major cryptocurrency that uses peer-to-peer transaction without the need of a central authority or banks. These transactions are verified by network nodes, documented, and then are packed into blocks that are sequentially added to the blockchain. It is then updated and synced to everyone using the technology, meaning if one node gets taken down or hacked, another one can instantly restore it. One can also purchase bitcoins and hold on to it as a form of investment. If an investor purchased $100 worth of bitcoins in 2011, those bitcoins would be worth over $482,000 today. There are now over 700 different cryptocurrencies. Ethereum, a new type of blockchain technology, is a decentralized platform that allows developers to program anything they want into it, not just cryptocurrency, something Bitcoin cannot do. With more research, I found that one could put IoT devices on the blockchain to prevent hackers from exploiting smart devices.
This is possible with smart contracts, applications that run exactly as programmed with no possibility for downtime, censorship, fraud or third party interference and can be placed on the blockchain. From an economic perspective, this will change everything as it also enables developers to create markets, store registries of debts, or anything they can think off; such as creating a democratic autonomous organization to cut down on cost and become more efficient. Many Fortune 500 companies gained interested when they saw a 3000% ROI in Ethereum, its many uses, and the benefits of using the new technology. For example Microsoft and Accenture, both in the Enterprise Ethereum Alliance (EEA), partnered together to create ID2020, an identity prototype based on EEA’s private blockchain and backed by Microsoft Azure. This will “empower individuals with direct consent over who has access to their personal information and when to release and share data. It is a sophisticated decentralized, or ‘distributed’, database architecture, maintained by multiple trusted parties”, thus eliminating the need for central authority.