5 Examples Of Blockchain In Our Life

The low turnout at president or parliament elections does not reflect the crisis of democracy in many countries even though such a disappointing phenomenon obviously calls to changes.

The crisis belongs rather to the method of voting than to elections as such. It seemed the Internet would altered the voting method many years ago by changing ballot boxes for an online procedure.

However, the shortcomings of web 1.0-2.0 consist of various hacker attacks along with the general unreliability of the Internet resources rooted in the centralized ownership of servers. And instead of making elections more honest and accessible, the Internet has become another threat for democracy (numerous rumors about interference of Russian hackers in many national elections are hardly groundless).

Nonetheless, the situation is not hopeless when it comes to web 3.0.  The decentralized distributed maintenance of the Internet nodes should be meant under the web3.0 concept.

The Distributed Ledger Technology better known as “blockchain” is quite mature being acquainted mainly by Fintech organizations since 2008 when the notorious Bitcoin cryptocurrency appeared (see our previous post about cryptocurrencies).

In the last couple of years DLT stepped far beyond just Fintech projects gradually occupying many other areas of online activity. The very decentralized nature of DLT is to become the key feature allowing web 3.0 to outlive those specific drawbacks of web1.0-2.0 that make the Internet currently inappropriate for various innovative approaches.

centralized-decentralized-distributed-systems

No centralized authority is required

We are not going to dive deeply into the technological peculiarities of the DLT. There are more than enough resources on the Internet containing the detailed description of the technology (just type ”blockchain” in Google and about 18 million results will be displayed).

However, we consider a good style to appeal to the thematic white papers when a brief but comprehensive explanation is required. In order to get such an explanation about the DLT we refer to the great white paper created by Hong Kong Applied Science and Technology Research Institute (ASTRI).

Extracting just few lines from this remarkable research we focus on the most important aspects of the DLT:

“Structurally speaking, a blockchain may be considered as a series of blocks of information that are securely chained together… New blocks are formed whenever participants create a piece of new information or change an existing piece of information about an asset.
All blocks newly formed after the first block are securely chained to the previous one, thus ensuring their authenticity and creating a trustworthy audit trail.
Unlike conventional transactions, the DLT distributes maintenance responsibility to the whole network. Hence, no centralized authority is required to manage, control or authorize transactions between participants”.

 

The World Computer and the diamond lockbox

The rapidly proliferating cryptocurrencies have already proved the reliability, viability, and security of the DLT in practice.

Metaphorically, the DLT can be imagined as a super tough but transparent lockbox made of diamonds. Everybody can see what assets are inside the numerous cells of the diamond lockbox, but only the cell owners can edit the content of their cells.

Only one feature is worth adding to such a metaphor – the cell owners have an instant access to the diamond lockbox through the Internet. We recall that the irreversible hash function such as SHA256 secure algorithm encrypts each block of information in a blockchain.

Ethereum, by the way, offers another good metaphor representing its internet service platform for guaranteed computation as a World Computer which is always on and which cannot be shut down or turned off.

 

blockchain_for_elections.png

 

“Elections-as-a-Service”

Let us get back to the election problem and assume a decentralized application (the so-called Dapp) created atop a blockchain platform such as Ethereum, for example.  

So, the “Elections-as-a-Service” application accessible via gadgets can offer much better opportunities for those voters who are either unable to visit polling stations for some reason or mistrustful of the local election commissions that can make rude mistakes when calculating paper ballots.

We believe the application could increase the election turnout several times over the current levels empowering the elected candidates with much bigger legitimacy.

However, such an improvement of the democratic procedure would not be the main advantage offered by the DLT-based application. The sheer transparent and tamper-proof nature of the blockchain technology would make the outcomes of elections invulnerable to any kind of manipulation or counterfeit.

Everyone would see the election progress in a real-time mode, but nobody would alter or misinterpret the results. What a damaging blow to corruption and populism!

 

Blockchain implementation models

Some may argue that such a Dapp is just a mental speculation having no practical background. Rest assured that software developers can rely on the existing Dapp frameworks such as Lisk App SDK along with the telling examples of Dapp startups containing in this impressive list.

Although historically blockchain appeared under the banner of Bitcoin, it is important to distinguish cryptocurrencies and universal blockchain platforms offering much wider opportunities in the form of smart contracts and tokens than just digital cash transactions.

The simplest way of understanding the difference is to compare the approaches of both Bitcoin and Ethereum. Bitcoin allows “Alice to send 5 cryptocoins to Bob” while Ethereum offers “Alice to send 5 cryptocoins to Bob when it is 14:00, April 25, and Bob has < 10 coins”.  Of course, this primitive comparison does not disclose the entire potential of the blockchain platforms.

In addition to our hypothetical “elections-as-a-service” concept the above-mentioned Lisk can indicate some other different services achievable with its App SDK:
 

  • Identity-as-a-service when encrypted personal information provides a single sign-in for various websites (an indispensable service for our hypothetical “elections” app, isn’t it?). By the way, Microsoft together with Accenture entered the consortium working over the blockchain-based digital identity – Decentralized Identity Foundation (DIF) ;
     
  • Decentralized hosting-as-a-service when any kind of content can be stored in a decentralized encrypted cloud (not bad for keeping elections’ results untouched);
     
  • Smart contract execution-as-a-service when networks maintain transactions without risk of DNS servers’ failure;
     
  • Oracles-as-a-service when outcomes of real life events and people opinions can be collected (our “elections” app can simultaneously act as a betting platform allowing people to earn some money from the elections’ results.
    Why not :) especially since the successfully running Augur  project is a living illustration of such an approach).

For those who are still hesitating with regard to the endless potential and the actual viability of the DLT we offer to attentively search this great post describing the ongoing blockchain projects with links to the related companies and startups.

 

internet-of-assets.png

 

The Internet of Assets

All decentralized projects and apps compose the entirely new business model being in fact the decentralized software protocols that gather people in networks for working on specific problems.

Probably the best explanation of that new business model was made by Fred Ehrsam – one of the most knowledgeable blockchain specs on the Internet.

According to him, by means of creating the Dapp-specific tokens (or in other words “the app cryptocoins”) business owners and app vendors  provide their projects with ample and ultra fast crowdfunding.

But that’s not the main point. All holders of tokens become both contributors to the new projects and co-founders (or shareholders) of the related businesses.

Just imagine, for example, Uber’s drivers and customers having Uber coins as their business shares but without Uber as the central entity.

The micro shares of any business’s ownership distributed through the Internet allow tokens to offer the new web3.0-based business model.

And, as Fred Ehrsam notes, “Thus blockchains first gave us the Internet of Money, now they are starting to give us the Internet of Assets»

 

It seems blockchain is the very Philosophers’ Stone that many companies are looking for to realize so desirable digital transformation of their business models.

Many business leaders throughout the world understand that the decentralized solutions will win while fighting them is pointless.

And “if you can’t beat’em ...join’em”principle works here well showing us Microsoft in DIF, Intel in EEA, PwC and Alibaba in Food Trust Framework, Sony and Spotify in OMI, Daimler AG (Mercedes-Benz) in Hyperledger, and so on.

 

One of IBM heads once said that everything would be digital and everything would be software. However, watching how things are going we would venture to guess that sooner or later everything will be blockchain!

 

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