Blockchain Can Make The Internet Safer, Fairer And More Creative Platform
“Blockchain matters because no business operates in isolation,” as quoted from “Blockchain for Business,” a recent book by Jai Arun, Jerry Cuomo and Nitin Gaur. “By implementing business processes that leverage the collective knowledge of the group, processes can be orders of magnitude more cost-efficient.”
Since the public, distributed ledger for bitcoin first started to gain popularity, people struggled to understand the potential of blockchain and what it is. This happens usually when potentially disruptive technologies are in its initial phases. But the question is, does blockchain technology really have the potential to become a revolutionary technology over a period of few years? Most people think it is. The business value-add of blockchain technology, according to Gartner, will become over $176 billion by 2025 and has the potential to exceed $3.1 trillion by the year 2030.
There are two common distinctive blockchain camps, one which primarily works on blockchain to become an underlying platform for crypto, while the other uses the blockchain technology for the evolution of the business world.
The book “Blockchain for Business” defines blockchain as “a shared, decentralized, cryptographically secured, and immutable digital ledger,” and then adds a few important factors that are crucial
- Accountability. “Network members are known and identified by cryptographic membership keys with assigned access permissions by business role.”
- Privacy. “Although members are known to the network, transactions are shared only with those members that need to know.”
- Scalability. “Supporting an immense volume of transactions is critical to enterprise scenarios.” Permission-based enterprise blockchains aren’t throttled by proof-of-work or proof-of-stake requirements.
- Security. “Enterprise blockchains are fault-tolerant. With fault-tolerant consensus algorithms, the network continues to operate even in the presence of bad actors or carelessness.”
- Motivational. “An enterprise blockchain benefits from a built-in incentive system to help accelerate the adoption curve,” such as tokens similar to loyalty points to encourage participation in the blockchain ecosystem.
In the early 1990s, the internet was supposed to prove revolutionary in creating a more open and decentralized economy. But obviously, it hadn’t quite worked out as we expected it to. Instead, it led to the beginning of powerful network effects on economic platforms. A few companies started to become dominant in their particular markets, making them category kings.
Steven Johnson perfectly explained how this happened, despite internet’s open protocols and distributed architecture system, with an example:
Considering the internet having a composition of two different stratums, being one on top of each other, say InternetOne and InternetTwo. InternetOne was created to be highly flexible, fairly simple, having general-purpose data network that would allow a wide range of applications on the Internet Two layer. Many open protocols being used in current types, like TCP/IP, HTML, and URLs, are connected with Internet One. Being a general-purpose system was a key design choice that has allowed the internet to constantly grow and adapt to widely different applications.
But, to keep InternetOne simple and flexible, just about everything else, including identity and security management, became the responsibility of the applications in InternetTwo, which has few universal open standards. It was left to private-sector companies to define such protocols in each of their applications.
The anonymous natureand security standards isacrucialreason for the rise of big enterprisesthat established standards into theirplatforms on the basisoftheirlarge collectionof data. Moreover, while the open,decentralized internet is in existenceand well in the InternetOne stratum, the InternetTwo stratumhas now become majorly centralized, and is being dominated by a few huge companies.
The blockchain technology has the ability to address the serious internet issues by allowing the transparency of data which is required to secure identities in a decentralized wat, without the particular requirement of an intermediary. Over the years, blockchain applications have proved to be efficient and can be used to operate self-organizing activities of a many institutions and individuals securely, which were previously the objective of the internet.
“Blockchain for Business” points that this factor makes blockchain to potentially become one of the most disruptive technologies of the century, proving revolutionary to the internet. It drives such abilities in three major ways:
- Distributed organizational structures. “The distributed nature of blockchain technology with consensus and smart contracts delivers a self-governing business network with a greater autonomy that flattens traditional enterprise structures into a distributed and shared structure.”
- Trusted business models. “Blockchain presents many opportunities…to disrupt traditional business models by using peer-to-peer exchange with trust, digital and automated execution of business contracts, and agreements with smart contracts. The intermediation between third parties is handled by distributed ledger and transparency, and transactions integrity with security and cryptography.”
- Decentralized ecosystems. With blockchain, the ecosystem is the business. Value is co-created among cooperating organizations and systems.