BLOCKCHAIN TECHNOLOGY – THE TECHNOLOGY OF TRUST

BLOCKCHAIN TECHNOLOGY – THE TECHNOLOGY OF TRUST

“A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.” – Satoshi Nakamoto

 

Satoshi Nakamoto wrote these words at the beginning of his paper explaining the principles of blockchain and the application to the finance sector. I personally find it ironic that Satoshi would share such a technology with the world one year after the largest failure in the modern financial system had occurred. This highlights the fragility of having intermediaries manage trust between people and businesses; Satoshi indicates there is a better way.

 

Blockchain technology allows the exchange of value to occur between parties without the involvement of third parties or intermediaries. Up to this point, the internet and digital content have relied mostly on the ease of replication of information. The power of this replication has fueled the growth of new businesses and allowed rapid communication of thoughts and ideas across the planet. Blockchain has introduced the principles of scarcity and trust through proof of work. These principles lay the foundation of any system, allowing men, who wish to deal with one another, to trade value for value.

 

Perhaps, in the future people will have the ability to exchange all information over the blockchain, without requiring third parties to broker the trust. Instead, the trust of the system will be in the hands of actors who are willing to invest the compute cycles.

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