Blockchain: Debunking The Myths
By Mary Roberts on ALTCOIN MAGAZINE
One of the most poorly understood and hyped technology — Blockchain has been creating quite an uproar recently.
Reason…
The mystery that shrouds it! According to a recent global survey by HSBC bank, about 80% of the respondents said that while they have heard about ‘Blockchain’, they didn’t understand the technology.
Sorry state exists … despite the significant efforts made by experts to explain the technology to the non-technical crowd through industry reports, mainstream media, online programs, and various other channels.
In order to understand it … let’s delve into the history of blockchain and learn about its evolution as the disruptive technology of today.
Blockchain — The Past, Present & Future!
The interest in Blockchain technology developed in 2009 when one Satoshi Nakamoto launched a cryptocurrency called Bitcoin. Blockchain was used as a digital distributed ledger technology to record transactions between the parties.
Interestingly the original white paper by Nakamoto talked more about Bitcoin — an alternative currency and store value with less to no attention is given to the non-currency uses of Blockchain technology like fraud reduction or KYC process, food safety, supply chain monitoring and land transfers among others.
While 2013 saw a dramatic increase in the cryptocurrency’s awareness, there were numerous people who concluded that using a public Blockchain like Bitcoin was not suitable for regulated corporations.
Because…
There were various myths about Blockchain floating in the market that it became difficult to separate the wheat from the chaff.
Result…
More confusion about Blockchain’s benefits and increased wariness to understand the technology.
In order to make Blockchain adoptable, there was a need to debunk them.
Debunking Myths And Understanding The Reality
1. Blockchain And Bitcoin Are The Same
Reality: Since Blockchain is the technology that was developed to record the transactions of Bitcoin, there exists a lot of confusion between the two. Bitcoin is a cryptocurrency, which can be exchanged between two people directly eliminating the need for a third party like a bank. Blockchain is the technology that records this transaction on a distributed ledger throughout the network.
2. Blockchain & Distributed Ledger Technology Are The Same
Reality: This is another common misconception/myth among people because Blockchain is a type of distributed ledger technology. The major difference between the two is that while blockchain is a sequence of blocks, a distributed ledger technology does not require such a chain. In addition, distributed ledgers don’t need proof of work and offer (theoretically) better scaling as compared to Blockchain.
3. Cryptocurrency Is The Only Blockchain’s Application
Reality: This is the most common myth floating in the market. And the reason is that Blockchain was introduced to record the transactions of cryptocurrency — Bitcoin. Moving beyond cryptocurrencies, Blockchain works brilliantly on its own and there are numerous use cases of Blockchain. Every industry from healthcare to food retail industry can use the underlying technology of distributed ledger.
4. Blockchain Is For Tech And Finance Professionals Only
Reality: As mentioned earlier there is a lack of understanding about the technology, so individuals from a non-IT background have not grasped the basic mechanism of Blockchain. Once companies outside tech and finance adopt the technology the fear of Blockchain will subside and there will be more organizations that will explore Blockchain technology to keep their transactions safe and secure.
5. Transactions On Blockchain Is Not Public
Reality: With a lack of understanding about the technology, there are numerous people who are under a false impression that Blockchain transactions are not public. Nothing can be farther from the truth, as Blockchain is a public ledger, which tracks the transactions between parties or groups. The transactions are visible to everyone.
There are numerous other myths related to Blockchain like Blockchain is not a reliable technology and that cryptocurrencies are best suited for criminals. It is best to remember that these are all myths generated out of lack of comprehension about the Blockchain technology.
As the myths are debunked the question that comes to the mind is … what does the future hold for this technology?
Blockchain’s future is bright with various organizations and industries other than IT and Finance realizes the benefits of Blockchain. With more and more non-IT industries adopting Blockchain to keep a track of their records, it is just a matter of time, when people from the non-technical backgrounds will also comprehend the benefits of this disrupting technology.
Till then, it is up to us to create a sound understanding of the technology for a better future.
