The explosion of bitcoin commentary and announcements hitting the news wire over the last year brought the original cryptocurrency back into the global spotlight where it was curiously absent for a few years. However, bitcoin’s rise to great prominence has overshadowed the true star of the show: blockchain. The underlying architecture that gives bitcoin its powerful appeal has largely been cut out from the conversation, with the focus on speculative cryptocurrency trading overwhelming the revolutionary applications of blockchain.
Blockchain Reframes the Conversation
For those unfamiliar with blockchain, it acts as a decentralized ledger that records all data simultaneously across all nodes on the network. The easiest way to think about it is in the context of current data storage. A website is hosted on a centralized server or bank of servers, a single point of access. All data collected by the company, whether relating to customers, transactions, or other information, is stored on these centralized servers. By comparison, blockchain stores all this data in millions of possible places simultaneously.
Blockchain is a tremendous achievement because it relies on distributing the processing power needed to run a network over thousands of nodes at the same time. Furthermore, it is considered immutable, meaning that transactions are one-way, verified, and cannot be replaced or adjusted without the consensus of more than 51% of the chain’s processing power. As a result, it has many practical applications and the ability to disrupt many industries. One of the most prominent use cases is related to logistics. Due to the number of different processes involved in logistics, the idea is to track all supply chain movements from manufacturing to packaging and transit on a single database that is updated in real-time. Apart from eliminating many common errors and maintaining transparency, it reduces the need for so many layers of oversight and automates many processes.
Why Blockchain is Ideal for Cryptocurrencies
Due to its decentralized nature, blockchain is a great platform for forming consensus, and therefore perfect for introducing and hosting a currency. Instead of a central authority issuing a currency and having the ability to print more, causing inflation, cryptocurrencies are minted in a finite amount and considered deflationary, contributing to a rise in value the more frequently they are used. Apart from being an idea for replacing fiat currency, the network verifies transactions while eliminating many of the barriers and costs associated with cross-border financial transactions. All transactions are recorded directly on the ledger and verified to eliminate the double-spend problem (same coin being spent twice simultaneously) and updated across all nodes hosting the ledger. As a result, the ecosystem is kept complete, and decentralizes the authority overseeing the entire process from start to finish.
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The Overarching Value of Blockchain
To contextualize the value of blockchain further, a perfect example would be the internet. Originally developed for transferring files and communications between computers, the internet first gained widespread appeal with the introduction of the world wide web. Before long, the internet was quickly permeated across the globe, creating a greater web of interconnectedness, eventually receiving embrace and application by businesses. If the early internet era can be viewed as an architecture improving our global networking, blockchain is the next layer of architecture on top of this framework.
Taking it one step further, the architecture can act as a platform for providing other decentralized goods and services through applications. Ethereum’s blockchain stands out here, acting as a platform designed to host other applications, and most importantly, smart contracts. A smart contract is effectively a contract that is automated thanks to special programming. When conditions are fulfilled, the contract is executed. The one benefit is that no third party is required to verify the agreement, improving the level of trust between both parties.
The Global Reach
Blockchain has swept across the globe like wildfire, touching upon nearly every continent in one form or another. While the technology has been treated as revolutionary, cryptocurrencies built on top of the architecture face more hurdles. On one hand, countries like Venezuela, Estonia, and Russia are planning the launch of their own cryptocurrencies whereas other countries like Japan have already labeled bitcoin as legal tender, enabling its transactability. While only a few countries have outright banned the use of digital currencies, most regulatory authorities are still trying to figure out exactly how to deal with the oversight of completely digitized and decentralized payment methods.
Blockchain on the other hand can transcend national sovereign borders and its use is not restricted. Some of the regions most noted for their embrace of blockchain and its accompanying ecosystem include Eastern Europe and Southeast Asia. Japan recently signed off on the incorporation of Cardano into local ATMs and debit cards, and the country was the first to begin offering bitcoin bonds to its residents via Fisco Ltd.
China is also at the forefront of development and embrace of blockchain-based platforms, with Singapore-based VeChain recently announcing a partnership with the government. VeChain is a platform designed for enterprises to help with a range of processes including logistics, authentication, smart contract execution and hosting decentralized applications. As enterprises find more applications and uses for blockchain systems, this momentum is likely to accelerate even further, akin to the rise of the world wide web. However, these innovative developments have largely been ignored by traditional news outlets in place of focus on the rising and falling prices of associated cryptocurrencies.
Bitcoin Distorts the Industry
News coverage of blockchain has been primarily focused on the meteoric rises and falls of bitcoin prices and other cryptocurrencies. However, this coverage fundamentally ignores the true value of blockchain and its disruptive potential. Even some of the biggest innovators within the ecosystem have highlighted this exact point. Most salient among its critics is Ethereum founder Vitalik Buterin who eloquently remarked on December 27th via Twitter, “All crypto communities, Ethereum included, should heed these words of warning. Need to differentiate between getting hundreds of billions of dollars of digital paper wealth sloshing around and actually achieving something meaningful for society.”
Instead of focusing the coverage on innovation, new companies bringing better services to the market, and highlighting the empowerment possible through the proliferation of decentralized technologies, the speculative element has gripped news media. Aside from doing a disservice to the entire blockchain ecosystem, it also is directing the attention towards the money and investment in lieu of the advantageous features and characteristics behind blockchain based technologies. Following in the footsteps of the speculators that brought bitcoin back into the spotlight, the attention it has received from news media is ultimately a distraction from the bigger picture, in a sense missing the forest for the trees. Despite numerous talking heads parroting their own forecasts for the prices of cryptocurrencies on talk shows, they have willfully snubbed the technology itself.
The Phoenix Rising in Crypto Media
While the traditional media has focused its attention on prices, new media outlets have moved in quickly to fill the void. New hubs are emerging that build on the more collaborative promise of blockchain. One of the most prominent resources among them is GitHub, a more technical community which looks under the hood at the new companies popping up within the space. Although not necessary news-based, it does highlight the more cooperative attributes of the community and the developers that support it. Apart from GitHub, actual new channels like CoinDesk, BlockGeeks, Cointelegraph, and even Investing.com are rapidly gaining prominence as the place to read about breaking news and developments in the crypto-space that are not strictly related to coin pricing.
Furthermore, even companies are changing the way they interface with stakeholders, opening public Slack channels that help users pose questions directly to the company while helping build the community support for a product. Amongst the most popular outlets for commentary and news-related analysis are public forums like Reddit, which has a legion of followers discussing all aspects of blockchain-related news and developments, bringing together a burgeoning community of like-minded individuals for an in-depth discussion. More public-sourced and crowd-based knowledge inherently has vast potential to disrupt existing coverage and force more blockchain enthusiasts to pursue other resources for education and insights.
Ignore the Hype and Focus on the Innovation
News media has played a large role in the hype machine contributing to the growing momentum of speculative activities within the blockchain ecosystem. However, the prospect of focusing on the industry’s more disruptive capabilities has fallen short of the list of items deemed newsworthy, easing the path for newer entrants devoted to covering the space and developments in real-time. Cryptocurrencies like Humaniq have bloomed accordingly, achieving partnerships that recognize their importance to helping emerging economies keep pace with the rest of the world. Solutions like Golem have also filled market needs, in this case providing a service for fractional supercomputing power. As Ethereum founder Vitalik Buterin so eloquently posted on Twitter December 12th, “How many unbanked people have we banked? How much censorship-resistant commerce for the common people have we enabled? How many Venezuelans have actually been protected by us from hyperinflation?”
Despite is vast potential to revolutionize and touch upon nearly every aspect of our daily lives, until the traditional media opts to focus more energies and attention towards the usefulness and disintermediation that is possible through blockchain, the point will have been completely missed. While easy to point to steep rises and falls that accompany bitcoin as the basis for newsworthy developments, the tremendous potential to advance society is lost in lieu of generating returns and pure speculation.
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