This blog post was written by a Software Developer at Catalysts
Newspapers claim, that blockchains will revolutionize far more than currencies. Notaries will lose their jobs, governments become unnecessary and game changers like Uber will be replaced by new game changing blockchain-based applications.
Impressive claims! This is reason enough to take a look at this technology.
A blockchain connects blocks, by storing the block’s content and a hash (a value used to detect tampering) of the previous block in a block. This results in a verifiable and persistent chain of information.
Blockchains alone are no big revolution. Its power is unleashed as multiple peers collaborate on one blockchain and we define who is allowed to create the next block.
So what are its features?
- Blockchains are all about removing the need of trust; As information is verified by all peers that collaborate on a blockchain, there is no need to trust each other.
- Blockchains are permanent, the content cannot be changed or deleted, just added.
There are several new possibilities that emerge on top of these features:
- Instead of a written contract, we can write an application and deploy it on the blockchain so it will be executed no matter what. For example: I will award person A 5 Bitcoins if Person A has 5 likes on his most recent Facebook post by Friday. Otherwise, return it to me.
- It is possible to host server-less applications by storing the relevant data within the Blockchain.
- It is unnecessary to define who is allowed to participate within a shared blockchain, anyone can do so if we want.
- Committed content to the blockchain is permanent, this makes censorship impossible.
- Property information can be stored within the blockchain, the owner can transfer ownership without the need of an authority.
Currently distributed blockchain implementations are not efficient in terms of network load, blockchain size and latency and will always have a certain overhead.
Software security failures may have fatal severity. And most importantly, existing popular public blockchains need to charge an amount of currency every time when something needs to be persisted on the blockchain.