How Does the Blockchain Innovation Work?
A few months ago I wrote an article on the potential applications for Blockchain Technology, and the main theme of that article was the need for companies who are looking to embrace this emerging technology to do proper due diligence before selecting a provider. In that article, I suggested that companies seeking to implement a single-use wallet would be wise to first learn about how the technology works, and what it can do for them. With due diligence, a company can identify a good provider of such infrastructure and then determine if it is the right provider for their needs. But in this article, I will briefly go over what I believe to be the most important consideration for companies considering the adoption of a new infrastructure for their e-mails.
The first question that any responsible enterprise should ask themselves is whether or not they will be able to successfully adopt new foundational technology into their business model. There are many potential reasons why an enterprise might want to adopt a new infrastructure for their transactions, and some of those reasons may very well justify the need to look at some of the other applications that are available on the market today. For instance, consider the tremendous opportunities that exist with address verification and anti-fraud systems. In order to take advantage of these opportunities, an enterprise must be able to make the decision to adopt some form of address verification, and also some form of multi-factor authentication. If those organizations cannot make those decisions, then they may easily find that their transition from legacy systems to the latest and greatest of the modern breakthroughs will be much more problematic than it could have been.
Another key consideration for most enterprises facing the potential transformational change involved in transitioning to the world of distributed ledger technology is the speed at which such a massive undertaking must be completed. One of the primary motivations that led to the development of the bitcoin ledger was to provide an open-source solution that could be implemented by anyone. This gave rise to what is known as the Dashboard, which is still active within the Blockchain Innovation. While the Dashboard provides a useful starting point for tracking and interacting with various components of the bitcoin network, it does not have the staying power that a more robust and mature solution would have. This is why there are so many core developers working on different projects attempting to create a more robust system.
Because this distributed ledger technology is open-sourced, it makes it a rather simple matter to experiment with its applications. The problem that faces most enterprises, however, is the fact that these experiments run the risk of being abandoned, and the projects that are abandoned are usually abandoned because there is no longer an interest in the project or there is insufficient interest in the core developers’ time and attention. When you take the opportunity to get involved with one of these projects, it’s important to remember that the outcome does not have anything to do with how you personally feel about the project. The outcome is based entirely on whether or not the technology can be used to deliver the results that the stakeholders require.
The developers who are working on different protocols are following a path that was originally laid out by economists called Pathfinders. This path calls for a dramatic transformation in the way that currencies and financial institutions actually perform business. This transformation has the potential to completely alter the landscape of global economics.
If the core developers continue on their current course, then they will find themselves facing a scenario where their baked technologies, which include proof of reserves and digital asset exchanges, will have to be upgraded in order to remain relevant. In addition, the protocol they have developed will have to evolve in order to deal with the changes that will come as a result of the adoption of the new foundational technology. This will mean a significant amount of work on their part. However, this is work that can take years to complete, and in fact, this can take years even with the current software platform they have in place.
On the other hand, there are a number of projects that are attempting to adopt the new paradigm by allowing users to transact in real-time through the use of a digital asset exchange. Rather than being tied to an exchange point like the real world, however, the e-mail account that a user will use to conduct all of their trades will act like a virtual private online wallet that will be able to hold various digital assets that the user wants to secure. The process will work much like the process of establishing a bank account, whereby one establishes a password and provides a deposit for the vault, and then allows them to access their funds. This is one of the fundamental differences between the old e-mail-based Internet payment model and the new distributed ledger system known as the Blockchain.
While there have been several articles written about how the bitcoin protocol can be applied to traditional markets, two things must first be understood about how this works: firstly, the bitcoins that are being used in these types of transactions are totally immune to any sort of third party attack, and secondly, the entire transaction is fully encrypted. Because the bitcoins being transacted are protected via the complex encryption process that the protocol uses, the entire transaction cannot be interrupted in any way. With the bitcoin protocol, there is no physical network that exists that will allow for unwanted or fraudulent transactions to take place, and this is what is behind much of the enthusiasm that people have for using the bitcoin virtual currency.