Blockchain is a hot topic right now and it’s undeniable. Bitcoin mania has become a mainstream news item and it grows bigger and bigger each day. I’m not a big fan of Bitcoin or Tulips or bubbles, but I think that it is great that Bitcoin has propelled the advancement and acknowledgement of Blockchain technology. As someone who just recently finished a full stack bootcamp and is about to enter web app development, I can’t help but think Blockchain will revolutionize data and web apps in a way similar to Cloud technology.
Blockchain will be useful as a way to maintain and implement a decentralized database. A decentralized database can eliminate the need for middlemen, offer transparency and a way to eliminate censorship or tampering of data, reduce the need for encryption and/or passwords, and lower maintenance/server costs. Blockchain won’t eliminate databases as we currently know them, but there are some extremely exciting use cases. Imagine a news website where articles couldn’t be censored or being able to plug your complete health history from one hospital to another with a click of a button. How about a system for unique, fine art, where ownership of a piece of art could never be questioned.
I think the true potential of Blockchain technology lies within smart contracts. Distributed ledgers are great, currency without regulation is interesting, but transparent, dynamic contracts are the best part of Blockchain technology. Smart contracts are currently being implemented within the Ethereum Blockchain, and that is the example I will describe. Smart contracts could be one of two things, either your unique address or a transaction potentially tied to your address. Your address consists of a public section, which is shared with everyone, and a private section which proves your unique, ownership of the address. A smart contract can also be the transaction itself. My example of this system is think about mailing a letter to a friend. In this case, the letter is a smart contract, your return address is your public ethereum address, and the postage is paid for in ether (the Ethereum currency). This letter is copied and mailed to 5 different locations including your friend’s address. Because it is mailed to 5 different places, someone could change the content of 1 letter, but it wouldn’t matter as the 4 other places are still in agreement with what the contents of the letter are. The letter itself is also intelligent, it can turn into a birthday message and present for your friend when it becomes his birthday on January 30th. If you made an accident, you could send an additional letter (with postage) that would modify the date on the initial letter and have the present be released on their real birthday, February 2nd.
So what are the possible use cases for smart contracts and blockchain, and additionally, what are the limitations? There are a couple ideas for Decentralized Apps, or dApps, that I’ve suggested and are also currently being implemented. A news website where the articles couldn’t be censored, if any edits were to take place, they would be shown as well. It could even be a social network, like Leeroy, where messages couldn’t be tampered with. Your personal information wouldn’t have to be scraped anymore because the website itself doesn’t possess the information. Your privacy would be protected. You could also put your entire healthcare history and data into a smart contract. You could instantly transfer your health information from one hospital to another instantly without any legwork. Everyone’s databases are built differently, but a decentralized database could plug and play into different systems. What about something like TicketMaster? If the ticket itself was a smart contract, you could purchase it directly from the source without middle men. You would instantly know if the ticket was real and because middle men are removed from the transaction, ticket prices themselves could be lowered.
There are issues with this system that will need to be sorted out. Transactions on the Blockchain are very slow compared to a normal database. Bitcoin handles 5 transactions per second, Ethereum can handle 20 transactions per second, and Visa handles 2000 transactions per second, on average. Blockchain is slow mainly because it is decentralized and transactions need to be confirmed from multiple sources before being confirmed. Ethereum transactions also need money (gas) to provide incentive to sources to help confirm your transaction and add it to the blockchain. If prices suffer heavy fluctuation, than this system could become more costly than a centralized database. In fact, at this point in time, adding gas to each transaction makes this system more costly to maintain than a centralized database, but this cost will lower as Blockchain becomes more refined.
I believe that as an entry full stack developer, I should be aware of the way future technology will change the way we build web apps. I am both excited and interested to see how Blockchain plays out, as it could become a key component of web stacks in the future.
