Blockchain has been labeled as one of the most promising technological innovations in recent times. However, like any disruption in the current landscape, it is difficult to accurately predict its scale and impact. For some experts in the financial market, it is increasingly clear that this technology is on its way to becoming one of the most overrated in recent times.
However, the use of blockchain across multiple industries and businesses has revolutionized the way users interact with investments, sports betting and college football picks, and redefined the concept of what a unified and global cryptocurrency system is.
Whether the use of cryptocurrency becomes massive or fades into obscurity, the truth is that the decentralized system of sharing information based on blocks of encrypted data reveals innovative applications every day.
This technology, which is changing the investing tendencies of millennials and centennials, promises to eliminate intermediaries in the relationship between network users and amplify their power, taking it away from the entities and institutions that have traditionally exercised it.
The inherent characteristics of blockchain technology seem to herald major transformations in the operation of a variety of operations performed on the networks. For example, a distributed database to which each user has full access and where no party controls the data that is entered, or the information that is exchanged.
To this we must add peer-to-peer (P2P) communication. The members of the network communicate directly with each other without going through a central node or transparency with anonymity. And it is that every transaction is visible to everyone who has access to the system. Each user and node on a blockchain has a unique 30-character alphanumeric address.
Finally, irreversibility. Once a transaction enters the database and the accounts are updated, the records can no longer be changed because they are “linked” to those that preceded them.
The unanswered questions about Blockchain
While there are undoubtedly technological advances and interesting applications within the blockchain space, the revolution that has been announced for several years has yet to happen. Ethereum language for smart contracts has the potential to become universal in the future, as was the case with the Windows operating system for computers or Android for smartphones.
Of course, at the moment, blockchain has not been able to replace middlemen in financial transactions, as banks, including central banks, continue to be in control. Blockchain has also failed to turn entire economic sectors upside down, as was predicted a few years ago. For some experts, this is enough to believe that neither of these events will happen anytime soon.
Today, the global financial industry conducts millions of transactions daily using algorithmic trading as a fast and efficient verification modality. While the Bitcoin blockchain can process between four and seven transactions per second due to the required cryptographic verification of all transactions, Visa, for example, processes about 24,000.
However, there have been many financial institutions that have incorporated blockchain technology into parts of their business to reduce costs and increase efficiency in the technological field.
The key lies in understanding that this technological innovation is linked to a significant paradigm shift in how we share, exchange, store and verify information and money. This is what most experts claim in favor of blockchain and the development of a strong cryptocurrency structure.
This transformation opens the door to a huge change in the far-reaching economic and social panorama. This will lead to the elimination of the figure of the intermediary or trusted third party. It is this unique feature, decentralization, that provides higher levels of trust, monitoring and security in digital services than traditional ones.
However, this does not mean that it is exempt from problems. There is no doubt that it has certain limitations and is still trying to earn the trust and support of consumers. However, it will expand over time, and even the term blockchain is heard in more and more places regularly.
