Ever heard the saying, ‘the more things change, the more they stay the same’?
Doing business on the internet has allowed for an unprecedented level of flexibility and convenience for consumers. Yet online retailers, financial institutions and companies in the sharing economy are still centralized, top down hierarchical structures, with profits skewed to those at the top. They use standard bookkeeping practices in which even a simple bank transaction can involve many middlemen and fees, and the time-consuming coordination of each company’s private ledgers. It has always been assumed that these real-world institutions are needed to ensure confidence in the cyber economy.
With the introduction of Blockchain, things are not the same. The technology allows for something once considered highly implausible: the secure exchange of value between people without dependency on an established third party. The central idea behind Blockchain is a massive shared ledger — essentially an open database that records and preserves verified transactions. This entirely decentralized system is impervious to hacking, can increase transparency and reduce fraud in many sectors of society. Adapting Blockchain technology with allow not only for more secure and efficient financial transactions but more integrity in product tracking, contractual obligations, identity management, land titles, and intellectual rights.
Blockchain does away with traditional ways of doing business while preserving the essential precondition at the heart of any exchange of value: the lowering of uncertainty and enabling of trust between two parties.
Watch Bettina Warburg’s Tedx talk, “How the Blockchain will radically transform the economy“, for more discussion on the pervasive influence of the technology.
This material has been drawn in part from Schulich Exec Ed’s upcoming program Emerging Technologies: Business Implications and Opportunities (Oct. 15 – 17, 2018), which allows you to explore potential opportunities for innovative competitive advantage and become a key enabler for your organization’s digital transformation.