In my time at Merritt Group, I've learned a tremendous amount about emerging technology in today's world, and I continue that hunt for knowledge each day. An area that's recently caught my eye is the exploding blockchain space, which seems to increasingly dominate headlines day after day. Here are some of my thoughts on the technology, articles and data I've culled through and why I think blockchain really is the next big thing.
In short, blockchain is a digital ledger that allows transactions to be made and recorded chronologically and publicly. It uses a decentralized database to store information permanently in “blocks,” recording any alteration made to a previous ledger or transaction through a timestamp and unique code of the transaction before it. By enabling its users to validate transactions themselves, blockchain inherently bypasses third-party mediators – such as financial, legal and government institutions – giving the technology the potential to shake up nearly every industry in today’s markets.
Think of it in terms of legal documents. Through blockchain, a will or contract can execute itself between relevant parties without much help from an attorney, changing the paper process to digital and decreasing time and cost of creating and verifying a binding legal agreement. Down the road, society may use blockchain’s global, decentralized source of trust to pay taxes, reduce fraud and send money to nations without immediate access to financial institutions.
Bitcoin is one of the most “buzzworthy” blockchain technologies today, cultivating fans like former Vice President Al Gore, Google chairman Eric Schmidt and Dan Tapscott, who quite literally wrote the book on blockchain. In a recent interview with McKinsey & Company, Tapscott mentioned, “I’ve been at this 35 years, writing about the digital age. I’ve never seen a technology that I thought had greater potential for humanity.”
But with all this attention, we can’t help but ask: is this hype sustainable? Will all the buzz surrounding blockchain and bitcoin fizzle out, or is it really the next big thing? Can people put their trust in math and machines and get rid of the middle man?
The truth is, blockchain has only built upon its media attention since it was first publicly introduced in 2009. As more technology experts have voiced their support (and intrigue), so have individual consumers. From a financial standpoint, bitcoin is booming: a single bitcoin is worth more than $7,880 today, compared to $140 in 2013. And while some financial analysts may suggest bitcoin is a bubble on the brink of bursting, the blockchain technology behind it holds fast.
So, can this tech really stand up to expectations? I’m with Tapscott. And Gore. And Schmidt. Blockchain creates innumerable opportunities for society and can only continue to live up to its deserved hype. By leveraging the technology as a global decentralized source of trust, users will protect their data in a more secure manner while managing a world dependent on IoT.
As Eric Schmidt suggested back in 2014, the challenge for companies lies not in whether they implement the technology, but when: “The ability to create something which is not duplicable in the digital world has enormous value,” he said. “The bitcoin architecture, literally the ability to have these ledgers which can’t be replicated, is an amazing advancement… Lot’s of people will build businesses on top of that.”
Interested in learning more about the latest trends shaking up the technology industry? Stay tuned to the Merritt Group blog for market insights on blockchain and more.