What happens when Blockchain and Our Lives collide?

As a tech lover I have spent most of my days in looking for innovations that can have a ground breaking impact on the way we live. I don’t really know how to narrow down such a broad field I am exploring. I mean, you will find that technology is now in almost every transaction and activity we participate in as humans.I was just continuing on my path and then came the rise of Blockchain. Some people have dismissed blockchain and cryptocurrency as a curse that brings trouble to people and has very less chances of becoming mainstay in our everyday lives. Others believe it presents too many advantages for businesses and consumers for it to disappear. But the whole point is ,this technology is too revolutionary for anyone to ignore!I started exploring exploring the implications of the blockchain on our human life. But wait, first I had to understand what is blockchain and why do we need blockchain?here, starts the era of me as a trader!

So, What Exactly is Blockchain ?

Blockchain technology was invented simply as a ledger for bitcoin transactions. But very soon it became clear that its decentralized, immutable, pseudonymous nature could be effectively used in numerous industries. Soon came what I call ground-breaking invention of Ethereum and the technology of blockchain was changed forever. Ethereum allowed developers to create any type of software on blockchain without limits. 

 I continued on my path as a trader. I had no technical knowledge about trading so I used a simple technique to invest in crypto. I just went to coinmarketcap and chose few coins below $0.5, opened their respective websites and asked just one question to myself. Do we need this thing in our lives? Call me lucky or whatever I somehow managed to make $1000 profit in 2 weeks. This profit was enough for me to take cryptocurrencies seriously.But major part of me was more inclined towards finding the answer of the question that do we need blockchain? What problems is it solving?Is it doing things better than the current tech available? If yes, how reliable is blockchain?

Do we even need Blockchain ?

Cryptocurrency, or crypto as it is often referred to, is the answer to a long-standing problem with finance and money. The problem with fiat is that it rewards the minority that can handle money but fools the generation that has worked and saved money. Today almost every nation in the world has its own form of fiat currency backed by no assets and issued by the government valued at its ability to serve as tax credit. It is likely to be difficult for retail banks to ignore technology that is more secure and reliable than their current databases. The real potential of the blockchain came when innovators and visionaries across industries began to realize that it could be separated from the digital currency and used to revolutionize every other industry. Firstly, its pseudonymous nature could help end identity fraud. Secondly, the decentralized nature of blockchain could help introduce faster payments than two centralized systems could ever manage.So in simple words blockchain will:

• Reduce costs
• have better security of information.
• have faster processing time
• have better information gathering and research

The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electrically but they lend it out in waves of credit bubbles with barely a fraction in reserve. We have to trust them with our privacy, trust them not to let identity thieves drain our accounts.While Some blockchains are very slow others are lightning fast. This lightning speed can make banking transactions more efficient. Use of smart contracts will massively reduce processing costs for banks. Several major banks are already moving towards using blockchain technology and Swiss Bank UBS is leading the way which agreed to use Ethereum as a way to improve the quality of their reference data.

Is Blockchain too good to be True?

Blockchain is indeed a great development but as they say “Every advantage has some disadvantage” . Unsurprisingly, many central governments are doing their best to limit the growth of cryptocurrency on their shores. But there are few flaws from which even blockchain can’t run away.Major Limitations of Blockchain are:

• Complexity
• Network Size
• Security Flaw
• Storage Constraints
• Unsustainable consensus mechanisms

Blockchain protocols offer an opportunity to digitize governance models, and because miners are essentially forming another type of incentivized governance model, there have been ample opportunities for public disagreements between different community sectors.These debates can be very technical, and sometimes heated, but are informative for those interested in the mixture of democracy, consensus and new opportunities for governance experimentation that blockchain technology is opening up.The current problem with cryptocurrency is that it is not widely accepted as a form of exchange today. This creates a situation where the price of crypto is defined, not relative to the value of the goods and services it can be exchanged for , but relative to its value in fiat or other cryptocurrencies it can be traded for. Another thing from which volatility arise in crypto is the fact that there is no central authority governing it’s price. And the volatility is increasing as more and more uninformed investors are pouring in.  

 

 Many of the new enthusiasts are people who’re in it only to make some quick bucks . Discussions on online forums have become increasingly about how much the price of the currency is about to rise — there is hardly anyone talking about actually using bitcoin in real life. If a large group of people keep accumulating an asset which brings no apparent benefit, other than being able to sell it to someone else at a higher price, you know you are going to have a problem in long run.

People save fiat because they consider it as a saving, but things are not the same with crypto at the moment. The dream of becoming millionaires overnight using crypto is eating up the organic market made by real investors overtime. Fiat money remains valuable largely because it is backed by the state and is controlled in terms of price and availability by the central banks.Perhaps the biggest threat blockchain-powered digital currencies pose for governments and traditional financial systems is the undermining of their authority and deprivation of their long-stretched “control and enforce” mentality. Meanwhile, cryptocurrency rides on the shoulders of the supposedly impregnable blockchain to circumvent the traditional banking process in its entirety.

Is Blockchain just all about replacing Fiat?

Looking at blockchain it is now becoming apparent that this technology is about far more than just Bitcoin. Across finance, healthcare, media, government and other sectors, innovative uses are appearing every day.There is more than digital currency that the blockchain technology can do to transform our lives. Many applications of this technology are already making lives easier of financial and banking institutions, hospitals, the legal system, corporations and governments all around the world. Blockchain technology is incredibly elastic. It can be shaped in different ways, to fit different processes.

There has been lot more talk about its usage in financial industry but blockchain has already started revolutionizing several industries and its implications in those industries can’t be neglected. Cyber-Security, Healthcare, Supply-Chain, Real- Estate, Tourism etc are some of the industries which blockchain is taking on with storm. Blockchain as a whole is still in development field and is far from being adopted on a large scale. But it is clearly evident that the existing processes can be enhanced or open up new technologies with the implementation of applications of blockchain technology.

Have I found peace?

My journey towards diving deep in blockchain and the way it effects are lives is still continuing. I am keeping a close eye on every innovation it has to offer. We still don’t know how quickly blockchain will be adopted, or even which blockchain technology businesses are likely to prefer, attempting to put a value on what blockchain is worth is meaningless. Every company in the world must be thinking of ways to make use of the disruptive force of blockchain technology. While the financial sector has dominated the headlines over the past couple of years, other industries are beginning to embrace this technology in a bid to democratize markets. Blockchain must overcome other hurdles as well, not least slow transaction times and wild fluctuations in value. Despite the benefits, some still see cryptocurrencies as disruptive. However, the best young blockchain entrepreneurs envision the components that can help any industry become more efficient. There are still challenges associated with blockchain. But the challenges are less technical than based on the issue of how to standardize on a network solution in a committed community of industry participants.

Whatever happens with our mainstream Bitcoin, though, it’s difficult to dispute the advantages that blockchain is likely to bring to our lives.