When mentioning Blockchain it is understood the discussion is about innovation. Many consider it to be the next major disrupter – like the internet itself was. To know its potential means to understand that there is only one road taking us in the same direction: a road leading to an inclusive, globalized and connected world.
In 2007/08 an economic crisis broke out and led to the bankruptcy of many financial institutions. It had repercussions on the stability of the global financial system. But the fallout of this crisis was the fracture in the relationship between society and banks. People lost credibility and confidence towards the banks, and it’s in this context where Blockchain emerges: the software platform first known for the digital currency Bitcoin.
Blockchain (block-chain) is a digital database open to everybody in the web, formed by a chain of blocks related to each other, as its name implies. These blocks are designed to avoid their modification once a data has been published using a reliable time stamp which is linked to a previous block.
Blocks can be defined as a set of transactions and/or information. There is a main block that starts the chain and then additional blocks are created and linked to the previous, forming a chain. Each one is formed by three parts: an alphanumeric code (that links it with the previous block); the package of transactions; and another alphanumeric code that will connect it to the next one.
So why is Blockchain considered so disruptive? In the first place, the decentralized way it works is highly innovative. It follows a Peer to Peer (P2P) system, so all the servers are connected to each other and transactions between parties is direct, without the need for intervention of third party (banks, for example). Interactions or information within the blocks are open to the general public on the web. The information that appears in your computer, and also is available to every user of Blockchain. They all can see and corroborate each intervention. Once it’s in the system, it can not be modified or deleted, and can only be updated with the consensus of the majority, guaranteeing transparency.
Even though the data stored in the block chain is usually individual transactions, the blockchain can also be used for other purposes, such as stamping documents and secularizing them against alterations.
Blockchain is growing as the most legitimate, accessible and modern way to manage data in the financial field. Anyone from anywhere in the world can now carry out any transactions they want and corroborate it instantly. The future is here.