Blockchain Explained - 2018


#1

Can someone explain to me in detail what Blockchain is and why is it important?


#2

Instead of explaining what it is, I think its probably better to say what it can do and what this means…

First, lets look at how the world works today. For almost any transaction today in anything, there is a buyer and a seller (in one form or another).

To carry out this transaction, both parties need to be able to trust each other - especially when you are trading from different side of the world.

Today, we have a third party platform that helps with this:

• Amazon helps you buy goods…

• Ebay helps you buy second-hand things…

• Paypal allows you to send money…

In all these examples, the company acts as a third party to make sure everything happens as it should…

Blockchain is a system for building contracts of some kind into its code. If you are buying a house, it could be a contract for a house.

This means that if the buyer and seller of house the contract will be built into the ledger of the blockchain…

This means that if someone is dishonest, this will be recorded on the blockchain ledger as well.

In sum, this means you do not need third-party platforms to help a transaction, because blockchain records all transaction it its ledger.

If you were trading with someone and they had been dishonest, you would see it in the blockchain and you would avoid them.

To use a comparison, a blockchain is like a long list of every transaction that has taken place. It’s also a list which cannot be de-frauded…

Why All The Hype?
Our society runs a lot of third parties and platforms when you think about it…

Lawyers, courts, banks and governments all are third parties which we rely on and who all have elaborate systems of code.

We use third parties, mainly because we trust. Blockchain eliminates the need for third party completely, leaving you and the person on the other end…

Blockchain will mean a lot of disruption in a lot of industries, here are a few:

Banks & Payments
This is one is obvious. we turn to banks and payments companies, because we need someone to trust. Blockchain eliminates that need…

Supply Chain Management
Supply chains dictate global trade, however they are notoriously inefficient. Blockchain technology would radically speed up trade and reduce inefficiencies…

Insurance
The global insurance market is based on trust. The blockchain is based primarily on trust levels and ensuring many types of data are kepy confidential.

Private Transport
Blockchain could be used to create decentralised version of peer-to-peer apps such as Uber.

Government
Government is notoriously slow to change. Blockchain technology would speed up change and significantly reduce inefficiencies…


#3

Interesting - thanks for that!