Blockchain technology was developed for the bitcoin virtual currency, but increasingly it’s being used to track and authenticate all kinds of assets, from stocks and bonds to electrons. Decentralized digital ledger technology–where information is stored in a shared and synchronized way amid hundreds of computers, instead of on a single server–could revolutionize several sectors of the economy.
In case you’re still scratching your head, don’t worry, many parts of our current internet technology also seemed totally alien before we fully adopted them. Here’s an excerpt from our longer explainer on how the blockchain works:
A blockchain is a ledger of digital events with no central database. It runs simultaneously across thousands of computers, distributing the record across the world. The blockchain is like a collective brain that no one controls and everyone can view. It’s both public and private. As a user, you encrypt your personal information, only allowing that data to be revealed when you make a transaction, such as when you transfer bitcoin to another person. But currency isn’t the only thing you can deal in. You can also store and transfer digital assets such as stocks, bonds, and airline miles. You can create digital IDs, allowing you to access secure websites or sign documents.
This year, we saw a proliferation of well-funded blockchain startups, starting in financial services and extending out to energy trading, remittances, supply chain custody, health care, and international development. In 2017, we’re likely to see the first blockchain consumer platforms launch–for example, in person-to-person payments and energy trading between solar households.
Something to watch: “decentralized autonomous organizations” (DAOs) that have no executives, directors, and run entirely on the basis of code. These self-managing companies could reduce “managerial wrongdoing and incompetence,” say two leading authors. There are a lot of possibilities on the blockchain in 2017.
The blockchain is coming—and it’s going to create huge benefits for the world’s poorest people, from financial access to property rights to controlling their identities.
2. How Bitcoin’s Technology Could Soon Shed Light On How Products Are Made
The same tech that prevents fraud with Bitcoin also can provide a chain of custody for products.
3. Democracy Is Getting A Reboot On The Blockchain
A startup from Latin America, Democracy Earth, is fighting corruption through internet voting technology.
4. This Blockchain App Helps Migrant Workers Safely Send Money Home
Everex lets people working abroad support their family without interacting with shady and risky middlemen.
5. How Blockchain Technology Could Decentralize The Energy Grid
Electricity will soon be made by the people and for the people—and the technology behind Bitcoin can help.
6. Is Brooklyn’s Microgrid-On-The-Blockchain The Future Of The Electric System?
A new cooperative, local, energy internet is emerging, and this project is on the cutting edge.
7. Tracking Tuna On The Blockchain To Prevent Slavery And Overfishing
Where does your fish come from? With the Provenance system, now you’ll know.
8. Can Crowdsourced Jury Trials On The Blockchain Deliver Justice For All?
Coders have grand (and possibly grandiose) ambitions to settle legal disputes on the internet in a fair and impartial manner.