By our CTO Tuna Orbay: Is Blockchain the new Internet?
Internet
When I first met the Internet (I’m talking about the “www”), I was a student at METU. While I was hanging out in front of the Baraka climbing building (I am a former climber), a friend of mine who was an assistant in computer labs suddenly took me to the labs. For the first time in my life, I’ve seen a browser, and I think the first website we visited was “NBA.com”. I am not sure about the website because we were trying to download Shaquille O’Neal’s photo. Connection speeds were really slow back then, so after a while we got bored and went out to lunch.
Now, you are expecting me to say, “How much the Internet affected me and how it inspired me, how I spent my whole time in computer labs til morning, and studied computer programming, and done lots successful web apps etc.” But unfortunately, it was not like that at all. I was definitely not impressed! When we came back from lunch, half of the photo wasn’t even downloaded yet. I thought “Nobody would wait so long just to look at a photo that you would instantly see in a newspaper or a magazine.”
As connection speed increased over time, I used the internet more and more in the labs and at home. In the upcoming years, this technology helped me build a couple of successful startups that will last for many years with my friends.
The reason why I am telling you this story above is that I was an “Average Joe” (still i am by the way) at everything. Back in 90s when you wanted to find something, you had to use Gopher, or you would use Pine for email, and if you want to play multiplayer games, you could play real-time text based MUD.
Even in the book “Internet for Dummies”, which I found in the library, “www” was the last mentioned topic, and they were not sure about the future of it. “Nah, this might be something years to come but we are not sure about it”.
The First Years
By the end of the 90’s, the internet began to spread to the whole world. In the beginning of 2000s, it was everywhere. People didn’t know what it was, and most organizations were suspicious and all they could do was set themselves up a website and email address if they are open enough. When people feel that their status quo is threatened by change, their general attitude, regardless of nature of the change, goes into defense mode with survival instincts. Instead of accepting it, they might become aggressive or ignorant. Many people of the “old-fashioned economy” have done this and disappeared. Those who keenly accepted the internet, won.
There was a thing called “Internet”, and it was sensational. With the “ao” sounds of ICQ coming from ever home at sleepless nights, people was surfing on the Internet till the first daylights. Some were meeting on the internet, dating -even marrying. Some were trying to build websites and trying learn HTML. Some were mastering linux as a server and trying to set up apache server to set up their first personal home pages. If you were a amateur designer you would go with Frontpage and only experienced ones would use Dreamwear. The engineers thinking that developing web based applications on the internet was not an option for their careers; even if they did, they were called hackers or webmasters. And internet was becoming a media that not everyone could really comprehend. Day by day internet was gaining everyone’s’ interest and becoming a popular media channel next to newspapers & magazines, television and radio.
If you are making money from the Internet back then, nobody would really understood what you were up to, and the best reaction you could get after hours of explanation about it was: “How do you make money from something that is not tangible?”. Well, I couldn’t manage to explain my family and friends what i was doing as a career and how I earned my living. After web 2.0 and social media became popular in our lives, people around me grasped internet and online media as a serious career option, and started to understand what i was doing.
Web 2.0
When the “dot com bubble” exploded at the beginning of the 2000s, it made people to question their trust towards the Internet. The number of internet users and their time spent were continuing to rise but for a short period of time some investors did not see it as an investable area. However, this was totally forgotten by the social media explosion and popularity; therefore, nobody even remembered the ”.com” crisis.
What changed everything was a very simple technology called AJAX (Asynchronous JavaScript And XML) and a fancy marketing term invented back in 99 and popularized by Tim O’reilly as “Web 2.0” in 2004. Of course, it is not entirely up to this, but it can be described as the beginning of a new period. This has caused the entrepreneurs and investors to reluctantly draw their attention to the Internet and its business models.
Something got really easy with AJAX and web 2.0. The Server and the client were able to communicate with asynchronous serial communication. Instead of one-way communication, communication got faster that everyone could interact with each other. Communication led the amount of information increase. As the amount of information increased, people were attracted to internet more and information became an important asset. Business schools started to discuss how information could be implemented as an asset. Companies were sold with unusual prices. Youtube sold for 1.65 billion dollars in 2006 and after the improvements in mobile technology Instagram without a solid business model, was sold for 1 billion dollars in 2012.
The Mobile followed the internet revolution. More people became online. More information and data were created. The increased amount of data and led to bigger systems, and more powerful servers. Then cloud came and data processing capability increased. The databases were not enough to process information so with the help of cloud it turned to something called Big Data. CPU power increased, ML and AI improved, IOT came into scene with the help of mobile technology. Now every year, we got to see a new disruptive technology that is ready to threaten or destroy the old one. Today, with Bitcoin and cryptocurrencies, we see blockchain as a disruptive technology. Probably bitcoin is just the tip of the iceberg, even it fails, the technology, blockchain will remain as a platform to develop new applications in the years to come.
How disruptive is Blockchain technology?
Blockchain, The New Internet?
The answer to that is both yes and no. Technically, it is not the new internet; it kind of works on top of it. Compared to the internet, blockchain can be more disruptive and can be a real game changer.
Blockchain is simply an implementation of distributed systems. Blockchain technology became very popular after Satoshi Nakamoto published his article about Bitcoin. Blockchain is disruptive just like the internet. The internet changed our way of lives forever. It changed our way of communication, our way of living, and the way how we do business forever. Now with blockchain, everything based on trust, or centralized authority has to change. It is a trust-less technology, that you no longer need a centralized system to the work for you.
Imagine if you could go back in time and tell people the following, what would they say?
Go back 20 years and tell them that “We will make your family album open to the whole world. You will want to this yourself and your favorite photograph will be your feet with a beach background.”
Go back 15 years and tell them that “You will be able to buy anything online including even shoes and glasses without even trying. You will even order your shoes from the other part of the world without trying them with the opportunity to send them back in case they don’t fit.”
Go back 10 years and tell to your fellow worker: “We will be using messaging tools instead of emails. Email is a slower way of communication.”
Go back 5 years and tell them that “There will be different type of cryptocurrencies in the market, and they will have their own currency exchange. Every company will be able to issue their own cryptocurrencies, and offer these coins in ICOs, instead of VC investments. Also, you will be able to trade these coins just like real stocks of that company in the cryptocurrency exchanges ” (Still feels unrealistic to me by the way.)
I guess no one, except the alphas and the futurists, would be able to guess the outcome of the scenarios above.
Just like the internet the case is the same for blockchain as well. It will disrupt! Now after internet revolution, we are all more careful. We saw the internet and mobile, the change in user behavior and the unpredictability of the future. There will be new developments related to Blockchain, but no one knows how. We just pretend. We are trying to implement blockchain in every line of work even if it’s not necessary. We don’t want to lose the battle this time.
Cryptocurrencies and payment systems are just the tip of the iceberg of this technology. In the past everyone were trying to build a website or learn html or scripting language, now everyone is trying to write smart contracts with solidity in Ethereum or set up a blockchain infrastructure such as Stellar or Fabric. Many organizations are trying to integrate this technology even it is not necessary. Many startups are trying to raise funds by claiming that they solve a problem with a white paper.
There is a chaotic environment just like in the first years of the internet. Just like internet boom everyone is expecting a blockchain boom but the balloon has not exploded yet. (Some people claim that the explosion occurred with the decrease of Bitcoin though). Regardless of anything, there is a fundamental truth that we are now in a road where blockchain is in our lives with cryptocurrencies. Pandora’s box is opened and there is no turning back.
Internet has redefined the way we work, express ourselves and communicate. Internet hit the world in the way of globalization. This trend mostly affected the traditional media agencies and commerce. Many newspapers and magazines were closed or were forced to change. We met new generation media companies. Many large companies had to close their doors due to the emergence of e-commerce platforms. Production is also changing with IOT and mobile technologies.
Now as a second wave of disruption, with blockchain, some values are questioned. Trust and transparency are defining again. We trust central authority, and we need to learn to trust decentralized trust-less systems with blockchain. It distributes and scales trust. Transparent systems will take over closed systems. Unlike popular thought I do not expect that the governments will collapse or central systems will totally disappear. However, I am sure that these structures will have to be redefined and they need to adopt to the this new technology.
Trust and transparency are the values that will be redifend with this technology, but when i think further questions that comes to my mind:
- How will urge to ownership be changed or redefined with smart contracts?
- How will the money be affected in such a digital world, will it be totally replaced by cryptocurrencies or will it be consolidated into a single currency?
- If transparency is a prerequisite of a successful ICO, how will we shape our company culture?
- How will the investment banks, investors and funds will be effected as the companies launch their own token as an asset in a world that they created with their own cryptocurrency?
- Is is possible to reach democracy with the infrastructure of a transparent blockchain system?
All of these questions are intriguing and dangerous at the same time. Dangerous because they contain disruption. If you want to maintain the status-quo as in the internet era, you have to learn to change or adopt. Change and adaptation are painful and tiring. You have to understand well, work hard and prepare in order to cope. (This adaptation is another topic which I will write about later.)
As I look back in time, I think the world becomes better with the every innovative disruptive technology. I personally believe that there will be new products and services that we have never thought of, or there will be new versions of what we already have in the future.
So, what do you think will change in our lives with the blockchain technology in the future? Let’s discuss it in our Telegram group;
