In Proof We Trust

Blockchain technology – the technology that powers bitcoin – stores digital financial transactions and records on different computers. Blockchains are decentralized. This unique design renders the system exceptionally secure. Using advanced mathematical algorithms, the system connects 8,000–9,000 automated computers which quickly verify and record a transaction. All the computers must agree on the transaction’s veracity, or the system won’t add the new “block” of data to the “chain” of data it already recorded. Humans can’t alter or otherwise manipulate this record; they can merely connect their own computers to the network.

“Few have seen this coming, but this new technology is about to change the way we interact online.”

Paying small amounts with a credit card isn’t currently economical because of fees. Because of blockchain technology, bitcoin doesn’t require a third-party bank or other institution to complete a transaction; transactions occur between the buyer and the seller seamlessly. Rather than use a credit card and without incurring transaction fees, one simply transfers bitcoins to another individual in exchange for a product. Bitcoin also facilitates anonymous payments – in black markets, yes, but also for undisclosed donations. Bitcoin protects personal information, unlike other forms of online payment.

“You will soon be able to vote from your mobile phone in a way that is 10 times more secure than the current US or UK systems, at a fraction of the cost and fraud-free.”

Blockchain technology has uses other than alternative cash. Blockchain-backed applications can record property assets. Honduras, for example, is developing a system that will use blockchain to register land ownership. People can also use the blockchain to create and record legal contracts. With its robust cybersecurity, blockchain systems will soon replace current solutions for online identification and reputation assessment. Blockchain-powered online voting systems will be cheaper and more secure than current processes.

“It is possible that blockchain tech will do the work of bankers, lawyers, administrators and registrars to a much higher standard for a fraction of the price.”

Because of all these applications, blockchain technology has the potential to disrupt many industries. Bitcoin is already disrupting banking and finance. With the rise of asset records, automated contracts and voting applications, the worlds of business, law and politics may soon transform as well.