Currently, the term blockchain and bitcoin are dominating the news on all platforms. Though you may see the terms being discussed simultaneously, however blockchain and bitcoin are not the same. Bitcoin is the digital cryptocurrency being operated using blockchain technology. On the other hand, blockchain is not only limited to reinforcing bitcoin but has a more comprehensive application that is now being commercialized.
With the enormous opportunities that blockchain is offering in the financial industry, public sector, and other domains, it has garnered a great deal of interest not only from the technological stakeholders but also from other markets as well. This article will briefly discuss blockchain, its relevance, and some issues that this technology may raise.
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What is blockchain?
To illustrate it simply, blockchain is a protected transaction ledger database that is mutually shared by all entities involved in a maintained, distributed network of computers. The technology documents and stores all transactions that transpire in the network. Thus, primarily eliminating the role of third parties such as payment processors.
This type of technology is being depicted as a monumental game changer since basically, sectors participating in the transaction do not essentially recognize each other yet they exchange value with assurance and with the absence of a third-party validation.
Why is this technology relevant?
The emergence of blockchain is being hailed by others as the second generation of internet. Although others are saying the technology is more than that, yet it is too early to say. Nonetheless, with the blockchain technology, it allows consumers to own their personal data. They can transact, create, and exchange value minus the third parties that act as arbiters of resources and information.
For the financial sector where blockchain is presently creating a large impact, its gains lie in the timeliness of data processing, transparency of data, and finally security. To find out more about the importance of blockchain, you may contact Adam Jiwan.
What are the potential issues it can raise?
While the technology can possibly bring us immense opportunities, however, there are a few who are apprehensive about the potential issues it can raise:
- Privacy
Since all participating parties have access to the database, the shared environment may raise the issue of confidentiality, cyber-security, and data protection. More than that, there may be competing companies who are both involved in the technology, how much information are these companies supposed to share?
- Can transactions be regulated?
With blockchain revolutionizing the way parties transact, regulators will want to evaluate how the technology is developing and will want to know if current guidelines are being followed.
