Over the last year, blockchain has evolved from an ambiguous concept in cryptocurrency circles into a predominant corporate tool for “disrupting” entire industries. Companies such as Google and Goldman Sachs are amongst some of the top investors in blockchain. But what is blockchain exactly and why is it so hot in the business world?
Blockchain is the technology that underpins cryptocurrency like bitcoin and ethereum. You can find interactive definitions of this form of technology, but in basic terms, blockchain is a distributed ledger or an account of all transactions and trades made by a business. Currently, any database that holds records of operational or financial transactions tends to be owned by a third party. Essentially, blockchain removes the middleman in deals, however, that is not the only function. It can also be used in a variety of other industries, like insurance and e-commerce.
Blockchain is currently applied to utility operations and energy markets as well. Other countries, besides the U.S., such as Japan, Austria, the U.K., and Australia have started using blockchains for their startups as well. Recent weeks have seen new blockchain-based energy hopefuls flourishing very quickly. Some examples of “real-world use cases” of blockchain and energy coming together include startups like Grid+ and Power Ledger.
Greentech Media CEO, Scott Clavenna, explains how blockchain improves energy investing. “The point of blockchain is finding ways where value is exchanged in electricity that currently is either inefficient or impossible because of regulations. We are looking at blockchain versus other, newer technology, which is looking for problems to solve,” Clavenna said in an interview from The Interchange podcast. Ultimately, blockchain carries out tasks and makes security a lot easier.
Thanks to blockchain, when you transfer money abroad, sign a business contract, buy diamond earrings or even download your favorite songs, your transaction can be bundled into a secure and identifiable block. And because blockchain removes a middleman from overseeing your transactions, it becomes more efficient and safer to utilize. Considering all that blockchain has to offer, it’s understandable why it’s so hot.
Read more posts by Alejandra Terrones.