Three things you have to know about the blockchain

How this digital ledger can change the world

The blockchain the technology behind the virtual currency bitcoin, can be used for many other applications. Imagine washing machines who can calculate their detergent, order and pay for it themselves. During an evening in de Brakke Grond at the 25th of February we discussed the promise of the blockchain with Michel Bauwens.

 

Digital ledger

The blockchain is a decentralized digital ledger which is stored and updated synchronic by all the computers in this database (read more in the next paragraph) This makes a central server like a bank or a middle man third party redundant and speeds up the transaction.

The Flemish cyber philosopher Michel Bauwens is founder and researcher on peer-to-peer networks, and how these networks can shape a new society. 

Upright transactions

But how can the integrity of a transaction be guaranteed without this trusted third party? On every new transaction an unforgeable encryption is made with the history of all previous transactions - like a financial DNA. These mathematical formulas are checked and processed by computers in the system, this is called mining. Users can make the memory capacity of their computers available for this action and become miners. A miner makes sure that within all the copies of the ledger there is a consensus. When there is a dubious transaction in one ledger no consensus is reached in the network and all other ledgers deny this transaction.

 

The promise of the blockchain

There are various applications to think off: from smart contracts, to alternative energy consumption contracts, voting-papers which can't be forged and well managed royalties for artists. 
Because the blockchain is a decentralized technology and puts the power back in the hands of the individual, it can give an opposing force in our digital landscape that is dominated by a few large companies such as Google and Facebook.

Want to know more? Read this article by Scott Rosenberg on Backchannel 'There's a blockchain for that!'
Or check out this movie (it's in Dutch)