Are we there yet?
Use cases of blockchain technology proliferate nowadays, mostly in the world of finance after the first cryptocurrency, Bitcoin, was introduced 11 years ago using Blockchain. The success of Bitcoin proved that the distributed ledger technology it espouses is changing the ways the world’s existing financial systems are being run, which, until today, are still based on antiquated principles. Interestingly, other sectors in the economic, legal, and political arenas are seriously studying the possibilities that blockchain technology can do to improve, innovate, reshape, or even reinvent the way the world operates.
Contracts definitively govern current world structures. Contracts bind parties involved to perform obligations called for to facilitate and satisfy the smooth flow of value. From individuals to organizations, from communities to societies, and from nations to nations, contracts were established to empower and to limit, verify and record, protect and release, manage and guide, and a whole lot more intangibles to ensure that systems and ideas work, commitments are fulfilled, and promises are kept.
As we are observing in the progressing history of humankind, the growth of populations and economies has resulted in an increase in interactions that are steadily bringing so much strain in the fulfilment of contracts. The bulk of processing thousands to millions of contracts has actually slowed down many promising businesses, which have no recourse but to live with it. Others, rather than being hurt with overheads, insurance fees, and lawsuits caused by stalled transactions, chose to simply fold up. These cases contribute to low GDPs of developing countries whose peoples turn to migration instead to at least offset poverty levels. Developed nations, too, are affected by insufficiencies being caused by entrenched archaic systems that draft solutions presented in legislative discussions offer little or no success evidence.
As such were the situations and circumstances surrounding the everyday way of life, qualified restlessness paved the way to useful discoveries. The technological breakthroughs the Internet platform provided and the subsequent digitization of many traditional systems heaved a sigh of release among those trapped with obsolete systems and processes. But as if that was it for modernity’s sake, another foundational technology was born.
Blockchain, that is
The most recent and important discovery of our lifetime came with the invention of blockchain technology. The Bauer and Stornetta 1994 concept paper was the foundation laid for Satoshi Nakamoto to build Bitcoin upon. The proof of concept led to more cryptocurrencies and exchanges coming out based on the blockchain blueprint that Bitcoin released. Bitcoin became Blockchain’s symbol of decentralization, transparency, censorship-resistance, security, and immutability. The market crash of 2008 was the perfect scenario for a new money system to take over fiat currency’s subjection to manipulative central banks, government intervention, or toxic intermediaries that dictate market movement.
Nascent and foundational, Blockchain as a backend technology has great possibilities of use beyond the walls of trading and finance, as creative engineers and developers are discovering. Use cases and applications are growing within business and life, governments, and other industries.
If that is the case, can we declare now that we have already reached the point of mass blockchain adoption? The safe answer would be – not yet. There are still a number of challenges to be surmounted before Blockchain is to be trusted.
For anything new, the mass level of mistrust is high. Contributory factors include theft and hacks and fraud. Regulators are out to protect the public interest, and they are not about to jump blindly to the blockchain bandwagon, no matter how promising it is. Centralized authorities are not that keen to pass the baton yet to an unregulated system. Further research and studies, tests, data, and use cases are still needed to be collected and collated before a verdict can be handed down. As of the moment, regulated blockchain use is viable until we learn the ropes well.
Ease of Use
Blockchain’s scalability is the one thing that can throw it back to the same systems it wants to address. And worse, it is slower. Bitcoin can only handle up to 7 transactions per second. Ethereum can take 15 transactions per second. Compare that to centralized engines such as Visa whose transactional speed is an amazing 24,000 per second. Among cryptocurrencies, Ripple is fastest at 1,700 tps. The problem of speed rests in Blockchain’s scalability. It will take time until this is solved. Furthermore, access to crypto wallets has cryptographic requirements that are too alien for the average user. Given that security of digital assets cannot be compromised, there is no other way (yet) to speed up security steps. For mass adoption, the requirement here is for the implementation of a plug-and-use formula for the average user to instantly avail of blockchain applications.
For sure, Blockchain is here to stay, waiting in the woods for its time to shine. But unlike the Internet, which took 37 years to be mass adopted after an initial 50 million surfers registered in the first four years, blockchain technology may even be faster given that it is built on top of the Internet, which has already surmounted any available obstacle. All that blockchain needs, being novel, is the broadness of its acceptance. It is still much talked about, as were the TCP/IP protocols of their time in the 90s when the Internet was young. Until such time that it fades into invisibility, Blockchain’s mass adoption is still years away. The expanding blockchain ecosystem is a guarantee that mass adoption is sure to take place as complexities are reduced. We have not seen yet a great deal of blockchain interactions except that in the financial world.
Yet, the old world is collapsing under a house of cards it built around the fiat currency. And the systems surrounding it cannot sustain it anymore as it is slowly being eaten up by corruption, fraud, and unfairness. Universal trust and agreement are keys to transforming our world today into a chain of virtue, and character blockchain is demanding for it to finally work.