Blockchain — Placebo or the Cure?

Why Blockchain Alone Can’t Help with Technological Advancement.

Technological advancement does not stand still, and everyday people are inventing the way that technology can help us save the world. It is inspiring to think that Blockchain can solve it all: corruption, undemocratic elections and bring equity, not just equality to the financial sphere. However, we cannot put responsibility to change the world and advance it technologically on the blockchain alone.

In July 2017, an unknown hacker managed to steal nearly $32 million US dollars’ worth of Ethereum. The root cause of the fraud was not related to deficiencies in the blockchain technology but, rather, due to a vulnerability within the software that was used to manage Ethereum wallets.

One of the recent examples is a decentralized Bancor exchange that had been hacked and as a result $23.5 million in coins were stolen. The frauds suggest that the successful adoption of blockchain is highly dependent on the security of the underlying environment.

Blockchain is decentralized, it means that it is not regulated, which may be a good thing in times when stealing our data is as easy as shoplifting candy in a supermarket. However, are we ready to put our future in the hands of a code, technology to manage our money and law? Or do we need the public, community, government to help and oversee implementation of this technology?

Although blockchain technology offers inherently secure properties, for an optimal and efficient future development, technology needs to be controlled, and guided in a right direction.

It is not about promises, it is about what it can deliver.

Below are a few examples of why blockchain cannot be a sufficient self-regulatory entity.

Blockchain is not resistant to malicious actors, it is simply more resilient — it bounces back with improved features. However, this improvement needs blockchain to have a big number of users. If blockchain does not have a strong network with a widely “distributed grid of notes” it will become harder to receive all of its advantages.

Another issue with blockchain that was pointed out by Satoshi Nakamoto called ‘51% attack’ means that if more than half of the computers operating as nodes to service tell network a lie, then the lie becomes the truth. That is why it is so important to monitor bitcoin mining pools by a robust and large community, making sure that no one unknowingly gets such power.

Blockchain needs oversight — the thing it tries to avoid — is the thing it needs the most. With the raising adoption of the blockchain technology, the bar needs to be raised and the underlying framework needs to be provided. However, society and political actors that can advance Blockchain also need to be vigilant and learn to adapt. “We can’t fundamentally advance technology until we fundamentally advance ourselves,” said Christian Cantrell.

Blockchain will change the world: but what kind of change it will be, will depend on us.

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