To some, it is synonymous with revolution and progress, in two words: the future. To others, hidden identity, hacking and the drugs trade. Layla Ali, conference producer at Clarion Events, considers both positions.
What is the truth about blockchain? Is a predispositional suspicion of technological advance preventing us from jumping on the blockchain wagon? Or are faults with this nascent technology to blame for the lack of large-scale uptake?
In the simplest terms, blockchain is a digital ledger recording transactions of digital currencies or data. Information is coded into the database, and once there, can never be edited or deleted.
Each line of code links to both the previous and following line, and can therefore eventually be traced back to its source, providing some information on the individual who made each transaction.
Blockchain’s best-known application is in payments and settlements using cryptocurrencies such as Bitcoin, Ethereum or Litecoin which, unlike ‘fiat currencies,’ are not linked to any government or state.
However, there are many who argue blockchain will disrupt any industry that functions on the basis of transactions and an agent.
This includes property and recruitment, for example. In fact, sectors such as energy, healthcare, food and drink and luxury goods are already harnessing blockchain to ensure the ethical provenance of goods and keep tabs on the purity of pharmaceuticals, among other things.
However, much of this activity continues under the radar, due to blockchain’s unfortunate associations with fraud, hacking (most recently of the NHS), and the trafficking of drugs, arms and people.
Enthusiasts versus sceptics
As such, on bringing blockchain up in conversation, you will likely be met with one of two responses. Person A, the blockchain enthusiast, will already have an e-wallet with stores of cryptocurrency, and be full of praise for this decentralised system that returns power to the people.
Person B, on the other hand, will be highly sceptical of the blockchain, like many tier one gambling operators at the moment, which remain uncertain as to whether blockchain will ever amount to more than a niche payments system.
Is this a mistake? For the most part, traditional land-based operators seem to work under the blissfully oblivious illusion that this digital earthquake will not affect their less technologically-dependent businesses.
They do not realise that the features of blockchain and cryptocurrencies — Smart Contracts, for example, provide fair games and the facilitation of faster peer-to-peer betting — make blockchain gambling sites a much more attractive proposition, even to a loyal land-based demographic.
Online operators are more likely to consider implementing blockchain into their payments systems, but the rise of casinos such as Dao, lotteries such as TrueFlip and sports betting sites such as Wagerr are proof of the revolutionary potential blockchain has when operators build their platforms on it, rather than using it as an add-on.
Of course an easy delaying tactic is to fall back on blockchain’s immaturity and cryptocurrencies’ susceptibility to hacking. Despite being widely considered the safest cryptocurrency, approximately 10% of Ethereum code contains bugs.
Bitcoin is even more prone to hacks and manipulation.
As a result and in addition to their volatility, it is uncertain as to whether investing in either is wise, and any operators which accept cryptocurrencies risk exposing themselves to hackers and those who would mine their stores, although there has also been recent evidence of mining lost currency back.
It is unclear at present whether blockchain will go on to disrupt the world in the same way as the internet did. As with the development of new technologies, glitches are inevitable, but once these are smoothed out and companies can no longer rely on them to justify inaction, how will they react?
At our inaugural half-day seminar on blockchain at EiG, we will be discussing the nature of the beast, road-mapping different implementation strategies and debating whether or not blockchain really is our future with the ground-breaking blockchain operators mentioned earlier.
So, will you take the blue pill, or will you take the red pill and join us? Come and see how deep the rabbit hole goes…
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