Blockchain 101 – Crypto Decrypted by Melrose PR
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by Kelley Weaver, CEO of Melrose PR
IoT, Machine Learning, Artificial Intelligence, Augmented Reality, and Virtual Reality are all emerging technologies that have already made huge impacts on diverse industries. But it’s not enough to say these solutions will change the world. In order for a technology to take off, businesses need to understand how it will solve their industry-specific problems. This is a matter of communication.
At Melrose PR, we represent projects utilizing the newest up-and-coming technology: blockchain, the technology underpinning cryptocurrencies such as Bitcoin and Ethereum. Despite the hype, blockchain remains hugely misunderstood. As a communications firm, it is our job to figure out better ways of explaining this somewhat complex topic in a way that people can wrap their minds around.
So, What is Blockchain?
A blockchain is a decentralized digital database that chronologically records transactions on an immutable ledger.
We would need a glossary of terms to fully explain the elements of blockchain using the industry-accepted language, which brings us to the importance of context.
Have you ever come across a word you didn’t know when listening to an expert on TV or reading an article, but you understood what the word meant anyway? The word ‘blockchain’ may be novel, but when explained as a part a particular solution, starts to make sense; just like you know what a car is without understanding the nuances of emissions systems.
Blockchain in Context
Blockchain is really best understood as a mechanism to track data transfers in a secure manner. Given the importance of data in today’s digital economy, such capabilities could not be more important. Every time you click, search, purchase, and post online you create data. This data is immensely valuable to advertisers, who can use it to hone their ad-targeting, but this data is also of interest to organizations, political and otherwise, looking to influence people to vote, join a cause, or take action.
Tracking Data with Blockchain
Issues arise when data is transferred or shared that isn’t supposed to be and then there is no way to verify what went wrong and hold the perpetrator accountable. Take the Cambridge Analytica-Facebook scandal as an example. For years consumers have sacrificed their personal privacy in exchange for access to Facebook’s free social networking platform. Facebook, like many other Internet-based services, collects copious amounts of data about users and then makes that data available to third parties (whether directly or indirectly through advertising). If every data transfer was tracked in a database that can’t be altered, we’d be able to go back into the history of transactions and decipher what data was shared and to whom.
If Facebook had such data tracking capabilities in place since its inception, perhaps the corporation would be incentivized to be honest with consumers and take steps to protect data from unwanted use. Instead, Facebook and other corporations have leaned on user data for generating revenue, and there hasn’t been much in place in terms of regulation to successfully hold them accountable when they step out of bounds. By keeping an immutable record of transactions, we would be able to more easily verify transaction events and hold responsible parties accountable for their actions.
Why Decentralization Matters
Blockchain technology is decentralized, meaning data is stored in many locations instead of one central location. Decentralized storage is generally more secure than centralized storage because a bad actor can hack into a centralized database once and steal data or value, whereas to hack the blockchain, a bad actor would need to breach the databases stored on many computers (in the case of the Bitcoin blockchain, hundreds of thousands) — a nearly impossible feat.
Just as data privacy has become an increasingly popular subject of discussion, we are also seeing a growing interest in decentralized platforms. The tech giants, Facebook, Google, Amazon, and Apple, are so data-rich and their influence so great, people are realizing the danger of endowing centralized entities with such power.
Noticing the increasing discontent among consumers, many businesses are using blockchain technology to develop peer-to-peer (p2p) platforms that eliminate reliance on centralized middleman. For example, instead of depending on a bank to mediate a money transfer to your relative overseas, you can send money directly to your relative using a p2p application like Circle. The benefit of using cryptocurrencies for such transfers is that digital currencies are borderless, so there is no exchange fee.
Other p2p applications include payments between content creators and their fanbase, as is the case for Steemit, a social media platform in which fans reward creators directly in token payments by “upvoting” their favorite posts. A past client of ours developing a similar platform for video content is POP Network. Once the platform launches, fans will be able to pay for video content in micropayments (fractions of a penny) instead of enduring interruptive ads and accepting the collection and re-selling of their data as occurs on centralized video streaming platforms like YouTube.
As is the case with any new technology, the jury is still out on how great the impact of blockchain technology will be on our day-to-day lives, but there is no doubt blockchain technology is already inciting the development of transformative, new products and platforms, from peer-to-peer payment apps to ad-free video streaming networks. The need for more secure mechanisms of data exchange and a growing interest in decentralization ensures that blockchain is here to stay.
Disclaimer: Multiple employees at Melrose PR own cryptocurrency. Pop Network was previously represented by Melrose PR.