Introduction to Blockchain
Join us in this introductory video to discover more about blockchain – a technology that has the potential to revolutionise financial services, electoral systems, insurances and even luxury goods e-commerce. Companies such as Orange and Spotify are investing in it and UBS is already trying it out at its Innovation Lab. But what is it exactly?
As Prof. Tucci explains, the idea behind is not novel as such. It comes down to an account book or a ledger, where transactions are recorded. When several people have access to the ledger and can view the transactions, it becomes a “distributed ledger.” And put simply, a blockchain is a form of distributed ledger technology (DLT).
To better grasp the advantages of DLT, let us look at the following simple example:
You buy a car for 10,000. Both you and the seller get a copy of the ledger with the transaction. What happens if the seller modifies the ledger and claims that you only paid 5,000? What would you do? Currently, to verify private transactions, you could contract a neutral third party and give it a third copy of the ledger. But the third party could be influenced to accept a modified version of the ledger or the ledger could be “attacked” – intercepted and modified before it even reaches the neutral party. What could you do to prevent that? You could make 1000 copies of the ledger and simultaneously send them to different places so that it becomes very difficult to intercept or alter them.
This is exactly how a DLT works: it reaches a scale where it becomes nearly impossible to get access and modify thousands of databases simultaneously. Therefore, the security of the transactions is enhanced.
Why is it called blockchain? With this technology one can easily list all the transactions that have happened with an asset. The asset can be a hard asset one as a luxury watch or a cryptocurrency. By looking at this chain of transactions, the asset can be traced.
What about potential applications? Currency transactions, stock markets or risk pool practiced by insurance companies can all benefit from implementing techniques derived from blockchain to squeeze out inefficiencies in their current systems. Blockchain thus would allow for faster and more secure transactions in any of these systems.
You want to see what else was discussed during the Innovation Leaders 2017 Conference ? Have a look below:
- Daniel introduce us to how blockchain can disrupt the government services: How Blockchain Can Help Governments to Deliver Client-centric Services?
- Alexis explored with the intricacies of the blockchain space : Blockchain: The Good, The Bad and The Ugly
- Lorien gave us some hints on how cryptocurrencies, like Bitcoin enable us to make the world a better place: How Digital Currencies are Changing the Way You Make a Difference?