Blockchain is an encrypted, open, decentralized database, recognized by leading mathematicians, cryptographers and economists around the world.
Blockchain allows in a mathematical way to agree on data and transactions, without the need for intermediate parties. The network is self-regulated, transactions get verified solving mathematical equations (blocks) in exchange for rewards.
(about the math: if you want to sleep well, Google ecdsa or mathematical trap door)
Data can be anything — money, work, property, votes, shares, anything that represents a certain value. The network verifies and agrees the transaction, every node in the network holds a(n encrypted) copy of the ledger.
When somebody tries to change a value (which would be easier in a local or centralized database), the network will simply reject it.
It’s very important to understand that there is no intermediary, no trusted middle man (no bank, notary, administrator), so less gatekeepers and weak spots, but also less centralized power.
Some example-applications of Blockchain technology
The largest and most famous application of blockchain technology right now is obviously Bitcoin (I’ve written an introduction to Bitcoin here).
I have a Bitcoin wallet (1BPvimykYyE1tmqmAy2S6Xi5tvRK1ow38r, thank you very much), thus also a copy of the entire ledger, and am an active node in the network (my wallet gets used to verify the authenticity transactions).
In Belgium, and probably in other countries, for job applications they request a copy of your degree. A copy, of a piece of paper that supposedly states you hold this degree, while they could just check the database.
But which database? And what if data is corrupted in that database for some reason? Suddenly, you’re not a licensed physician anymore.
A Blockchain application could store this data, making it very easy to check, and virtually impossible to corrupt or tamper with.
Some piece of paper and values in a few databases claim you have ownership over your house. It still takes ridiculous amounts of paperwork, an expensive notary and too many layers of middle men to legally claim your place your own. Very last-century.
The Blockchain could register the ownership of addresses and properties, and agree upon transactions of ownership.
Votes can be registered and transferred (from the person holding a vote, to the party/idea/bill that can receive a vote) through a Blockchain application, making it less vulnerable to technical caveats, and far better protected against tampering.
Shares in companies can be agreed upon by the Blockchain. Not only that, it also has a complete history of each share, eliminating and simplifying the entire structure.
Working on a rather big project right now to bring corporate legal to this century, I believe strongly this could be a solid solution in the future.
Something more specific that relates to me — flight hours are still kept in analog log books. Loose the log book, and all the data becomes void. As if you suddenly didn’t fly those hundreds of hours. Baffling.
Here’s a great video explaining it rather well:
We’d love to work on a POC Blockchain application, contact us if you have something in mind.