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How the Technology Behind Bitcoin Is Changing Money, Business and the World
- Read in 13 minutes
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- Contains 8 key ideas
Blockchain Revolution (2016) sheds light on a new technology that may soon change the way we bank and do business. Blockchain is the technology behind the Bitcoin – but it could be so much more. If we utilize it fully, we could do away with costly middlemen and create a transparent financial system free from the endless corruption and dark money that plagues the world.
Key idea 1 of 8
The blockchain is a decentralized database technology that is secure and trustworthy.
Let’s say you’re looking to buy a house, but the seller insists that no banks or notaries get involved. You’d probably be pretty skeptical about such a seller’s trustworthiness.
This is why we’ve come to rely on middlemen – intermediaries that ensure the transaction is legitimate, allowing both buyer and seller to rest easy.
Banks have long served this purpose by authenticating transactions and keeping track of property titles to confirm who owns what. More recently, businesses such as Uber and Airbnb have begun filling the role of middleman platforms and now vouch for the reliability of a driver or apartment owner.
However, history shows us that middlemen themselves aren’t always the most trustworthy.
Banks can go bankrupt and lose your money by making bad deals and companies like Uber can sell customer data without getting consent. And with more and more cases of unwarranted surveillance, even governments can seem untrustworthy – and they’re certainly capable of going bankrupt themselves.
So where does the internet fit into all this? Well, until recently, most people would say that the internet lacked the proper security for big transactions involving money or property. But there’s a new technology that might change this conception for good.
It’s called blockchain, and it comes with a protocol that allows buyers and sellers to bypass traditional central authorities like banks.
It does this by making every transaction a transparent process. Everyone using the blockchain has access to, and thus compose the management of, an incorruptible decentralized database.
When a transaction is made, it gets timestamped and added to the database. When it clearly doesn’t corrupt the system and is agreed upon by the majority of all parties involved, it gets legitimized.
With this level of transparency and verification protocol, there’s no opportunity for hackers or thieves to make changes that will go unnoticed. Plus, the system doesn’t allow for changes to old entries.
Since no one entity controls the blockchain, everyone can trust it.