THE FUTURE OF BLOCKCHAIN

“YOU SHOULD BE TAKING THIS TECHNOLOGY AS SERIOUSLY AS YOU SHOULD HAVE BEEN TAKING THE DEVELOPMENT OF THE INTERNET IN THE EARLY 1990’S.”

BITCOIN WAS JUST THE BEGINNING:

There has always been a hype about bitcoins but don’t let the zeitgeist fool you. People need to understand the difference between blockchains and bitcoin. It’s not the bitcoin but the technology behind it that’s revolutionary. Cryptocurrencies like Bitcoin rely on blockchain to conduct transactions. We’re going beyond Bitcoin and developing applications that might reshape democracy, economics, advertising, and more.

HOW DO BLOCKCHAINS WORK:

Blockchain stores transaction data in blocks which are linked together through a chain. All the blocks in Blockchain have their unique hash for identification, are of limited size, and linked together by pointing to their previous block.

Anyone from anywhere can review data entries on one block and record new ones into another block. The blocks and the contents within them are protected by powerful cryptography, which ensures that previous transactions within the network cannot be either forged or destroyed. In this way, blockchain technology allows a digital currency to maintain a trusted transaction network without relying on a central authority.

ENTICING PROMISES OF BLOCKCHAINS

Cross-Border Payments

Blockchains are real-time, guaranteed and fast alternative to typical remittance which might cost as high as 20% of the transfer amount. Blockchain may allow for costs as low as 2%

Smart Contracts

BlockChain has replaced the central authority required to validate a contract between two counterparties and relies on a digital code to confirm transactions. It oversees all aspects of an agreement, from facilitation to execution. After all the required conditions are met, smart contracts can be entirely self-executing and self-enforcing.

Identity Management

Blockchain technology has transformed the way that online identity management works by offering an unbreakable level of security through independent verification processes which take place on each member computer on a blockchain network. In digital currency cases, this verification is used to approve transactions before they are added to the chain.

Transparency:

It’s transparent. All the information is visible to everybody and it makes use of ‘zero-knowledge proof’. The zero-knowledge proof reveals the truth of a certain statement without revealing the additional information beyond what it is trying to poof. so it saves you the unnecessary details.

Versatility:

A blockchain network could be used in real estate (real and virtual), package delivery, smartphones, elections, and much more. So it’s not only limited to cryptocurrencies.

BLOCKCHAIN WILL DISRUPT COUNTLESS INDUSTRIES:

Top 10 sectors most susceptible to revolutionized by blockchain within the next five years:

• Financial Transactions
• Micro-payments
• Banking
• Supply Chain
• Crowdfunding
• Securities Trading
• Voting
• Healthcare
• Cloud Storage
• Virtual Property
• Education and Academia
• Ride Sharing Industry
• Shipping and Logistics
• Online music industry

TOP FACTORS HINDERING BLOCKCHAIN ADOPTION:

The blockchain is in its Infancy

Futurists believe that the current state of the Blockchain Era is reminiscent of the dot-com boom in 1997. Given the historical similarities, blockchain is still missing most of the key infrastructure and tooling to build applications, let alone good user experiences.

Speculation

Digital currencies are extremely risky. Investors perceive cryptocurrency as a speculative investment which might kill the innovative nature of blockchain development. When investors lose confidence, a very volatile price evolution and possibly a price collapse is expected if the supply dries up.

Lack of awareness

According to research, nearly three-quarters of people say crypto-asset wallets and crypto exchanges are difficult to use. The need is to provide a user-friendly interaction and to create more education and awareness.

Regulation

One big set back is the regulatory policies of the world towards cryptocurrency. Unfortunately, agencies are not ready for an ever-changing system so many are in a state of disagreement. So much so that a few countries officially banned blockChain.

The EU has taken a firm stance on data privacy, implementing stringent regulations that have notable implications for blockchain.

Scalability 

Scalability of the blockchain is a big question mark and there are more questions than answers, however, there is a high chance that this issue will be resolved in 4-5 years to come.

Mining complications

Because of some shortcomings of Bitcoin and other cryptocurrencies, here is a perceived negative environmental impact of the blockchain. It is because bitcoin’s mining process that requires a “proof of work” to validate transactions.

Proof of work is a mathematical algorithm that is essential to validate transactions in the Bitcoin blockchain and consumes huge computational power and energy close to what Denmark consumes annually. Ether uses the concept of proof-of-stake which is energy efficient, while the cryptocurrency ripple does not require mining.

Unproven Value

Many investors still not recognize the value and capability of blockchains and are reluctant in investing in them.