Blockchain Explained

Blockchain technology. You just can’t escape it. It seems that everyone is talking about it, yet no-one seems to understand what it is.

The simple fact is this: blockchain technology has the potential to change the way that we conduct financial transactions for the rest of our lives. If that excites you, then come on-board, we’re going for a ride.

What is blockchain?

Blockchain is the driving force behind cryptocurrencies such as bitcoin and ethereum. Originally used for transactions involving crypto trading, blockchain has emerged as a new technology capable of impacting many different aspects of our lives, including how we get paid, how we access our money, and even how we vote.

Its selling point is decentralisation. Rather than storing your money in a bank, or transferring money between bank-to-bank, blockchain cuts out the middleman, meaning that you have full control of your money and can transfer funds to others instantly.

Sounds great. But how does it work?

I’m glad you asked. The blockchain acts as a sort of digital record book, of which everyone involved has access to. When Jack transfers funds to Jim, the request is sent to hundreds of other computers in the world, which all automatically verify that the transfer is legitimate before authorising the transaction. If a single computer notices an inconsistency, the transfer will be incomplete. Instead of having a third-party (a bank) verify your transactions, the combined programming power of hundreds of computers guarantees your money’s safety. Here’s the kicker, it does all of this instantly.

Every transaction made via blockchain technology is stored forever. As long as the internet continues to operate, your transaction will be embedded in the blockchain technology. What this means is that it is impossible to forge transactions or change previous payments. The second someone tries to operate dishonestly; the power of hundreds of computers will simultaneously shut down the transaction.

Security is one of the premier selling points of blockchain technology. Here at PLAAK, our primary interest is the safety of your finances, but if that doesn’t fully convince you, then perhaps the World Economic Forum might be able to change your mind. Even they are convinced that through “public key infrastructure”, blockchain can ensure your security and privacy.

I don’t really use cryptocurrencies. How can blockchain help me?

Well here’s the thing. Blockchain is still a toddler. The use of the technology might seem a little far-fetched now, I mean, I’ve personally never had a problem with the good old fashioned Australian dollar after all. What we’re dealing with here however, is the way mainstream transactions will be run not next year, probably not even the year after that, but in five to ten years’ time.

Don’t believe me? Major companies investing in blockchain technology research include Swiss banking giant UBS, The Bank of Canada, Microsoft, and Bank of America.

Let’s think even bigger than cryptocurrency for a minute.

Imagine a world where you can anonymously vote for the next Prime Minister using your phone, with no way that your vote could be corrupted. Imagine what that could do in countries with less stable democracies than our own?

Imagine a world where an encrypted deal made between two parties would keep everyone accountable. Where the transaction is only made once both parties have completed their end of the bargain.

Imagine a world where you can have control over your finances even if you can’t access a bank. Imagine what that could do to stop corruption and theft in third world countries.

The PLAAK team wants to help make this world a reality. In the digital age, we are committed to bringing this new technology to you. We hope you will join us on this journey, it’s your world after all.

-Wilson Bell

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