It is no secret that interest in Bitcoin and other cryptocurrencies have surged to unprecedented levels, especially considering Bitcoin’s recent spike above $5,000 per unit. Many attribute the cause of this spike and the growth of interest in cryptocurrency as a whole to the ingenious technology behind the cryptocurrencies — blockchain.
What is blockchain, exactly?
According to Don & Alex Tapscott, authors of Blockchain Revolution, “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”
More detailed information about blockchain is available on Blockgeeks, but there are two crucial parts to the definition above. First, the idea of blockchain as an incorruptible record of transactions.
The genius of the blockchain is that it functions as a decentralized database, whereby all transactions are recorded on a digital ledger and broadcast to each member of the network. As such, the need for an intermediary is effectively eliminated — just as Bitcoin has eliminated the need for banks to serve as the middle-man for transactions. Moreover, it allows for an unprecedented level of transparency.
The second part of this definition that is crucial to understand is that blockchain can be used not only for financial transactions, but for virtually everything that carries value.
In the past, blockchain has been used in unconventional ways such as tackling human trafficking, tracking blood diamonds, registering land rights, and revolutionizing the music industry. Other alternative uses of blockchain have been suggested as well, ranging from distributing cloud storage to protecting online identity to digital voting.
So, what are some other uses of blockchain technology? Here are four startups implementing the technology in cybersecurity, publishing, big data, and credit risk assessment:
Vault One is a cybersecurity startup that aims to reduce data leaks and unauthorized sharing of passwords, social accounts, domain registration, server credentials, and cloud services by using a private Ethereum blockchain.
Each time credentials or passwords are shared using the company’s solutions, the transaction is recorded on the blockchain which serves as an indelible record of who has access to what, as well as when and how that access was gained.
Using this technology, the company purports to avoid 80 percent of security breaches due to improper access of privileged credentials.
In the publishing industry, DECENT aims to “revolutionize digital distribution across the Internet” by eliminating middle-men, such as publishers, who take a significant cut of the artists’ profit.
Using the company’s platform, artists are able to connect with buyers after uploading their original content. Creators can upload any type of content that they produced — music, videos, photos, books, etc. — along with a price at which they would like to sell the content. Consumers, then, are able to purchase the right to access the content using the company’s own cryptocurrency.
By creating their own cryptocurrency under the symbol DCT, all transactions between artists and consumers are recorded and authenticated, which provides greater transparency and profit to media creators without relying on traditional publishers.
According to the company’s website, Datum is “The decentralized ecosystem to store and exchange structured data.”
The company offers technology that allows users to backup and store data from social networks, wearables, and IOT devices in a secure, private and anonymous manner, which can then be sold according to terms set by the owner of the data. The transactions are done over the network using the company’s DAT token, which users must pay to store data and earn by selling data.
Given the importance of data in today’s world, the company is hoping to provide the marketplace to exchange this increasingly valuable information.
PayPie intends to bring transparency to the area of credit risk assessment as the world’s first blockchain accounting platform.
Risk assessment has also proven to be a tricky endeavor with companies reporting financial discrepancies or manipulating the data to look a certain way when it is viewed. For this reason, institutions such as lenders, auditors, accountants, insurance companies, and tax authorities have often had difficulty seeing an accurate view of a given company and performing an appropriate assessment.
PayPie’s technology uses the Ethereum blockchain for triple-entry accounting, keeping track of all of a company’s financial transactions in a permanent format that cannot be later manipulated. This allows assessors to view an accurate representation of the company’s current financial standing and perform an accurate credit rating.
According to a publication by the Harvard Business Review, widespread adoption of blockchain technology to transform businesses and government is still many years away due to the fact that blockchain is not a disruptive technology, but rather, a foundational technology — upon which entirely new economic and social systems will need to be built.
The same article suggests that “while the impact will be enormous, it will take decades for blockchain to seep into our economic and social infrastructure. The process of adoption will be gradual and steady, not sudden, as waves of technological and institutional change gain momentum.”
While this may be true, startups such as those mentioned in this article are clearly paving the way and providing a glimpse into what business and economies could look like in the future.