From Consensys’ white paper on blockchains
While the jury is still out on Bitcoin’s contribution to civilization, the digital currency has introduced us to at least one promising technology.
Called blockchain, it’s the infrastructure behind Bitcoins. Its advocates hail it as the most revolutionary technology since … well … the internet.
Don and Alex Tapscott, authors of a 2016 book called Blockchain Revolution, offer this definition:
The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.
Put another way: blockchain tech is frequently described as a shared spreadsheet or ledger than is maintained simultaneously across thousands or even millions of computers, with no central data storage.
Every part of the peer-to-peer network verifies every incoming transaction, which becomes a new block of data that gets added to the “blockchain,” so the recorded value is available to everyone on the network.
Fans of the technology cite its efficiency as a global network of value exchange, the fact that it has no single point of failure, its very high level of security and its ability to generate value for its community of keepers.
An interesting white paper from blockchain firm Consensys — which describes blockchain tech as “The Internet of Agreements” — points to three inherent “fairness advantages”:
- “Everywhere is the same, because a blockchain has no center.”
- “The record is permanent to protect transactions, [offering] extremely strong cybersecurity.”
- “Nobody is in charge of the global blockchain as a whole, [although] local blockchains can be run by a sovereign entity or a company.”
One mitigating factor
It may all sound a bit like the early pitches for the internet. In fact, on its website Consensys characterizes its open source, blockchain-based distributed computing platform Ethereum as “how the Internet was supposed to work.”
Of course, the internet blossomed into something far beyond the fever dreams of even the most ardent fans. But it also showed that, however great the promises of any technology, there’s always one mitigating factor:
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