The recent bull runs in the crypto market have attracted a large number of investors from traditional markets. For new investors who have just recently joined the throng, here are some details you may want to know how the crypto market came into existence. You may have heard about blockchain technology. But some may find the word a little complicated and some may even think that does it even matter to understand it? For anyone who wants to take a dip into the market, they may find it helpful to understand how it works and what makes it work. Why? Because it is part of fundamental learning. As you delve into the crypto market, you will encounter more complicated and technical terms. But if you know the fundamentals, it will be easier to grasp how each product of the technology works.
So, what is blockchain? First, let’s go and travel back to where it started.
What is Blockchain and How It Started?
According to Wikipedia, blockchain s a growing list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data (generally represented as a Merkle tree). By design, a blockchain is resistant to modification of its data. Meaning it is immutable and tamper-resistant. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks. It is also sometimes referred to as Distributed Ledger Technology (DLT).
Based on the description given, we can therefore conclude that blockchain is the safest and most secure way to store data. So, who could have started this genius idea? Who was responsible for the creation of blockchain?
In 1982, David Chaum, an American scientist, and cryptographer made a blockchain-like proposal in his thesis titled “Computer Systems Established, Maintained, and Trusted by Mutually Suspicious Groups.”
In 1991, Stuart Haber and W. Scott Stornetta used a system where documents timestamps that are tamper-resistant cryptographically by securing a chain of blocks. The duo invented the blockchain we know today.
In 1992, they were joined by David Bayer, an American mathematician. Together, they incorporated the Merkle trees into the design to further improve the efficiency.
And comes Satoshi Nakamoto. Does it ring a bell? Of course. In the crypto world, everyone knows this person. He conceptualized the first blockchain in the creation of Bitcoin. Though no one knows his real identity, undeniably his initiative to utilize blockchain has paved the way to the crypto world we know today. In 2009, he released the first Bitcoin whitepaper. Bitcoin is the first-ever digital currency the world has ever known. Nakamoto created Bitcoin to provide a solution for double-spending without the need for intermediaries. The existence of Bitcoin also gave birth to the creation of other cryptocurrencies we have today. From one cryptocurrency, we have now 4,000 cryptocurrencies in the crypto market.
When we say blockchain, are we simply referring to cryptocurrencies? Apparently, not. Why? Let’s take a look at how blockchain is now interconnected with the life of almost everyone even those outside the crypto market.
How Blockchain Evolved from Cryptos to Apps
Blockchain technology, the underlying technology used by Bitcoin to operate is now being used by a large number of apps. And these apps do not operate only in the crypto world but have found their way to the real-world. Here is a list of some blockchain real-life use cases.
Block Armour is an enterprise cybersecurity company founded in 2016. It helps organizations of all sizes protect themselves against advanced threats. It uses the Blockchain-Defined Perimeter (BDP), an enhanced software-defined perimeter that renders critical systems and cloud servers invisible to intruders.
Medicalchain is a decentralized platform that enables secure, fast, and transparent exchange and usage of medical data. The company was founded by Dr. Abdullah Albeyatti and Mo Tayeb in February 2016.
Veem is a San Francisco-based online global payments platform founded in 2014 by Marwan Forzley and Aldo Carrascoso. It uses blockchain technology to execute payments.
In North America, we have Canada. The National Research Council of Canada (NRC) had built an Ethereum blockchain explorer to experiment with transparent administration of gov’t contracts, and reliably sharing data with the public.
Toyota has partnered with the Massachusetts Institute of Technology (MIT) to build safer autonomous vehicles. Using blockchain, vehicle manufacturers will be able to share autonomous vehicle data in real-time.
World Food Program uses Building Blocks to support refugees. Then you have Unicef Australia that created a web page where you can mine crypto for charity. Also, St. Mungo uses Alice, a blockchain platform that shows where your money goes.
Walmart, an e-commerce giant has announced that they will be offering blockchain as a service option under the AWS banner of “AWS Blockchain Templates”. This will help to create and deploy secure blockchain in the network through open-source frameworks.
- Real Estate
ShelterZoom was founded in 2016 in New York by Allen Alishahi, Chao Cheng-Shorland. It uses blockchain to manage all aspects of the real estate offer and acceptance process. It keeps records on every real estate deal to ensure an immutable financial record.
Cool Cousin was launched in Tel Aviv in 2016 and is being used today by more than 500,000 travelers across the globe. The blockchain-based ecosystem of the company offers an accountable and authentic tour opportunity for its users by incentivizing local guides to monetize their local knowledge.
- Media and Social Media
Fluz Fluz pairs blockchain with social media on its e-commerce platform. It offers cash-back rewards for shopping at some of the largest companies in the world, like Starbucks, Nike, Disney, and Uber.
Telcoin, a Japanese startup utilizes blockchain to enable telecommunication operators to provide money transfer services. Through its Telcoin Wallet, mobile users can make global transfers instantly, regardless of local mobile service providers.
Other industries are also considering adopting the technology due to the following benefits:
- 1. Transparency
- 2. Efficiency
- 3. Security
- 4. Traceability
The introduction of other product innovations of the technology makes it more appealing to investors worldwide. The utilization of blockchain technology in the real-world offers so many conveniences to all its adopters. As the technology continues to grow, and so is the crypto market. According to data by Coinmarketcap, the crypto market has now a total market cap of $1.57 trillion. It constantly increases every day. With a huge market, regulators worldwide are aiming hard to regulate it. Can regulators come up with ways soon to regulate the market using its underlying technology, blockchain? That sounds like a good idea, right? But it is yet to be seen.