Sunday, March 12, 2017

On Blockchains and Innovation in Digital Commerce

  • Last week the Harvard Business Review article “The Blockchain Will Do to the Financial System What the Internet Did to Media” said “The “killer app” for the early internet was email; it’s what drove adoption and strengthened the network. Bitcoin is the killer app for the blockchain. Bitcoin drives adoption of its underlying blockchain, and its strong technical community and robust code review process make it the most secure and reliable of the various blockchains. Like email, it’s likely that some form of Bitcoin will persist. But the blockchain will also support a variety of other applications, including smart contracts, asset registries, and many new types of transactions that will go beyond financial and legal uses … 
  • Unfortunately, the exuberance of fintech investors is way ahead of the development of the technology. We’re often seeing so-called blockchains that are not really innovative, but instead are merely databases, which have existed for decades, calling themselves blockchains to jump on the buzzword bandwagon … 
  • However, it is likely that, just as Linux is now embedded in almost every kind of commercial application or service, many of the ultimate use cases of the blockchain could become standard fare for established players like large companies, governments, and central banks”.
  • Separately, a blog post at Google’s AI focused health tech subsidiary, DeepMind said ”Imagine a service that could give mathematical assurance about what is happening with each individual piece of personal data, without possibility of falsification or omission. Imagine the ability for the inner workings of that system to be checked in real-time, to ensure that data is only being used as it should be. Imagine that the infrastructure powering this was freely available as open source, so any organization in the world could implement their own version if they wanted to … 
  • Over the course of this year we'll be starting to build out Verifiable Data Audit for DeepMind Health, our effort to provide the health service with technology that can help clinicians predict, diagnose and prevent serious illnesses – a key part of DeepMind’s mission to deploy technology for social benefit …
  • The ledger and the entries within it will share some of the properties of blockchain, which is the idea behind Bitcoin and other projects.”
MY TAKE 
  • Blockchain style solutions may be as transformational to global commerce as the World Wide Web’s Hypertext Transfer Protocol (HTTP) and Hypertext Markup Language (HTML), which changed the process of digital content creation and distribution.
  • These approaches will likely support programmable services and enhance our view of what digital assets are and how they will be used.
  • However, success will require 1) executing transactions in a secure and timely fashion, 2) providing services that are easy to use, 3) adapting to a growing community of users, 4) addressing cyber-crime and 5) confronting competition from incumbent players.



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