There is a lot of hype about blockchain technologies and their potential to transform business. From cryptocurrencies to supply chain management to cyber security talk of blockchain seems to be everywhere. But how will block chain impact you personally, either at work or home? Should you be concerned or excited about it?
The answer is both. Blockchain, like many new technologies, is part of an evolution from what is today to what will be tomorrow. If you invest in learning about blockchain you’ll have a chance to see when blockchain technologies will disrupt and replace existing technologies. You can use this information to make career changes and changes to your investment portfolio.
What is blockchain?
At it’s simplest, blockchain is a way of recording data that both preserves the history of interactions with that data and keeps copies of those records on many computers. In order for a new transaction to take place, the data are verified across the entire system, ensuring trust that the data are real. Cryptocurrencies offer an example. When you purchase a good using cryptocurrency, the system verifies that you actually own the cryptocurrency. There are no bad checks to bounce, fraudulent charges or counterfeit money. The same technology can ensure that the data being used by your self-driving car is coming from your sensors rather than from another car’s sensors, or worse yet, being fed to your car’s computer by a hacker. There are many possible applications for blockchain and many types of blockchain.
Presently, blockchain technologies are in their infancy and significant work is being done to address shortcomings that can get in the way of mass adoption, especially the speed of verifying the transactions. There is no reason to believe these hurdles can’t be overcome. It will just take the time and resources to learn how to address them.
How Might Blockchain Affect You?
Blockchain has wide spread applications and will affect a wide variety of jobs and nearly every, if not all, companies. Here is a sampling of how blockchain may affect you, your work and your lfie.
Cryptocurrencies Change How We Use Money: Cryptocurrencies will reshape the way we make financial transactions. Today any type of financial transaction involves some significant fees and often take days, if not longer, for the transaction to clear. With cryptocurrencies, the transactions can cost hundreds of times less and clear almost instantly. Consumers and business alike will benefit from the lower fees. Those who work in the affected areas of financial institutions will find their work transformed. As new crypto-related processes are developed and other processes retired, jobs will both be created and destroyed. New systems will need to be designed and built. The lower fees will also bring new consumers, the “unbanked”, into the system. For those who learn about blockchain and different cryptocurrencies there will be great opportunities.
Trusted Third Parties and Legal Work: We use trusted third parties to facilitate transactions and verify ownership. Smart contracts enable the transfer of ownership automatically when conditions are met. If you work in any related field, in the coming years the way you do your work will likely change significantly. Not is the time start learning the technologies and terminologies so when the new products are ready to be rolled out you are able to understand what they do and how they work.
Ensuring Ownership and Security: From deeds to mortgages, car titles and stock ownership, from music rights to copyrights proof of ownership and authenticity are needed for well-functioning businesses and the economy. With records stored on a distributed ledger, gone are the needs to prove the authenticity of documents.
Auditing and Accounting: By it’s very nature, blockchain is ledger, recording transactions. Because each transaction is verified and recorded multiple times and stored on multiple computers(distributed), it is secure, replicable, and virtually impossible to tamper with. In a report by Deloitte, Blockchain: A game changer for audit processes, they speculate that auditing a high value processes could be reduced from month or more to about an hour. This would eliminate the need for substantive sampling in auditing and allow for nearly real time assurance. From the perspective of an accountant or auditor, work would be sped up while the need to learn new technologies would be needed. Naturally, entirely new accounting systems would need to be built.
Internet of Things: The internet of things, simply put, is about machines talk to machines to make decisions and adjustments to whatever process they are monitoring. From driverless cars adjusting monitoring the road, driving conditions and the car’s functioning to your refrigerator sensing it is time to order milk, the internet of things is growing rapidly. Today there are over 20 million connected devices on the internet. Within 5 years that number is expected to more than double. In order for the internet of things to function, it’s necessary to have trusted and verified information, information that can’t be altered by attack or a system failure. The distributed nature of block chain provides a both a fail safe and a level of security to ensure that the instructions and data being used are accurate and genuine. Blockchain could very well lead to great confidence and faster growth in the internet of things.
Take some time to research and consider how blockchain can be used in your industry and what it’s touchpoints with your role may be. Research more about what blockchain is so you can understand it conceptually and develop a more intuitive understanding. Blockchain is coming and it’s here to stay. It’ll likely impact your work and almost certainly devices you uses on a day-to-day basis.