There is something deeply confusing about blockchain. The idea of a distributed ledger – or decentralised global database – is straightforward enough, along with all the analogies that get used to break a complicated idea down to glorious picture book simplicity. Yet despite the relentless efforts of all those news pumpers, outside of fintech, the use cases are still largely not there. While much of the chatter is pure speculation that hinges on a lot of very diverse factors lining up at once.
This means that everything around blockchain tends to fall into one of two camps. Either it is a broad brush overview that makes perfect sense until you have a tentative scratch at the surface. Or it is ludicrously complex and riddled with technicalities, sub clauses and general ‘time will tell’ uncertainty.
What is clear though is that a core group of blockchain zealots are hell bent on yelling about the life altering benefits of this technology at the top of their voices. Like any new technology wave they appear to believe this will solve every social and business problem that you care to mention and – because they shout the loudest – seem to be bringing a clutch of slightly dazed and bewildered individuals along with them who aren’t quite sure how to protest.
Most of the real experts in blockchain highlight the chinks in this picture. One example of this that doesn’t get talked about too much is that although having a perfect, tamperproof ledger online has all kinds of benefits there are still issues with how you search it. You can create a search index site, if you want to, but then that site itself can be compromised. And this is one of numerous other small technicalities that muddy the picture – without even getting into the business reorganisation that needs to take place for this technology to really take off.
What is most highlighted by the people who know their stuff though is that all the hype around blockchain means more and more pointless uses get proposed. This is always the way with shiny new technology. People inevitably want to use it over something perfectly ordinary and old fashioned – as much for the publicity as anything else.
If there is any kind of overarching truth about blockchain though, it’s that beyond the short-term complications and long-term possibilities, it is actually pretty prosaic. There are two main types and they have very different use cases.
There is the private kind, which big technology firms like IBM are throwing money at hand over fist. These are the ‘intranet’ of blockchains and aim to add gated accountability into the enterprise. Then there is the public kind – which gets all the headlines as it is associated with infamous digital currencies like bitcoin – and has wider accountability benefits. People get into all kinds of long involved arguments about the pluses and minuses of the each but as usual it mostly depends what organisations want to achieve.
Blockchain has already made big gains in fintech, the UK government is taking it up with alacrity (with the aim of getting in early as ‘a leader’), and then there are all kinds of new startups in the space – who generally won’t talk to anyone yet because their companies are so new. So, while it is extremely clear blockchain has an awful lot of potential let’s not pretend it is going to end world poverty or change earth as we know it. At the end of the day it is glorified (decentralised) database which can be applied well to certain things but not others.
Last Summer I spoke to everyone who would talk to me about blockchain and tried to get to grips with what this was really about. A proper, in-depth article on the subject can be found here:
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