What Really Lies Behind the Blockchain (Beyond the Hype)? Part 1
Few areas of Finance drew as much attention as Bitcoin 2–3 years ago. In 2013, the world seemed to have found the new digital currency that could (one day) replace the US Dollar. In 2014 and 2015 though, and as the price of the Bitcoin decreased from USD1,000 to USD230, the public’s interest for the BTC tended to decrease. Over the last 12 months or so, the public’s attention re-focused more specifically on the Bitcoin’s underlying technology: what is called the “Blockchain”.
What is it? The Bitcoin’s Blockchain is a public ledger of all (valid) Bitcoin transactions that have ever been executed, added to it with a new set of recordings, in a linear, chronological order. Each block includes the hash of the prior block, linking the blocks together, thus forming a chain of blocks (i.e. the “Blockchain”).
Some will tell you it’s a breakthrough technology that will enable endless new applications in the digital area, similar to the Transmission Control Protocol (“TCP”) and Internet Protocol (“IP”) that were the first networking protocols developed for what we know today as the Internet (with a capital “i” at the time). Some will tell you it’s a fad, or a buzzword.
On May 3rd, 2016 Ashley Taylor, Peter Todd, Lory Kehoe and I (Jean-Michel Pailhon) participated to a panel discussion during France Fintech’s R:Evolution event in Paris. The name of the panel says it all: “What Really Lies Behind the Blockchain?”.
The three experts with whom I exchanged insights during this panel are all recognized experts in their fields:
- Ashley is cultural implementation strategist at ConsenSys (a blockchain app production studio on the Ethereum ecosystem)
- Peter is core developer for the Bitcoin protocol, an applied cryptography consultant (aka “blockchain tech”)
- Lory Kehoe is Deloitte Ireland’s blockchain lead
During those 20 minutes, we went through the following questions.
1/ Blockchain is the new buzzword. Lots of people talk about it, without being sure of what it really is. Could you please simply explain us what the blockchain is? How it works and what it does?
2/ Can you separate Bitcoin from the Blockchain ?
3/ Why is the Blockchain potentially revolutionary?
4/ If the Blockchain-tech really takes off, and if it does become the system which enables everyone to interact and transact without central intermediary, who are the middlemen we won’t need anymore?
5/ Most Financial institutions are interested in designing specific applications on a separate or “private” blockchain. This is the way chosen by the consortium led by R3, which has been launched involving 42 financial companies (mainly investment banking arms of largest banks) in September 2015. How far are we from building a real infrastructure out of the blockchain? Should it remain public or private?
6/ Would you launch a blockchain-technology based startup right now, what pains would you try to solve, what type of sectors would you try to jump in?
The next post will go through Ashley, Peter and Lory’s answers to those questions. Stay tuned!
