With Blockchain creating waves in the banking industry, business transformation solutions provider, Ovations, is looking into who it will affect the most as well as the opportunities it presents for the market as a whole.
Blockchain is the open, secure and distributed database that powers the more infamous cryptocurrency BitCoin. Craig Leppan, Director of Business Development at Ovations says that Blockchain is in short a public ledger of transactions and can best be described as a massive distributed Google spreadsheet, on which participating users are constantly looking to add entries about a consistent set of transactions, but that can’t be tampered with, even by its administrator.
Its reputation for being disruptive is hinged on its ability to create cryptocurrencies, particularly due to the anonymous nature of the participants behind the transactions. While popular thinking is that it is just for building payment systems, Leppan says that there are a host of non-currency applications that can be built making use of the open nature of the Blockchain system.
“The cryptography and security behind it are complex, but the key thing is that the ‘spreadsheet’ is copied and held by all users working with it. What this means is that no one owns it but they all contribute to the updates. No one user can bring it down or add to it unilaterally, it’s a consensus system built on creating new rows in the spreadsheet or “blocks” necessary in the on-going “chain” of transactions,” says Leppan.
The Trust Machine
It was recently described in a cover story of the Economist magazine as the “Trust Machine”, an apt term for the underlying value that the Blockchain system provides. However, in this descriptor lies the threat it poses to third parties that are currently providing the self same services.
“Several banking and card associations may view Blockchain as an attack on the central nature of their clearing and settlement operations. The bigger concerns also come from Reserve Banks who see it as breaking the financial controls of cross border payments, and this has led to many banks staying clear of embracing it,” adds Leppan.
Trusted Third Parties
Trusted third parties come in many shapes and forms, and not just as financial Institutions. In fact a Deeds Office, Shares and Trading desks, as well as anyone who holds a record of ownership on your behalf qualifies. Generally, a third party will be guarding their central private ledgers of users’ transactions and the fees associated with providing that service.
The Blockchain system allows the open and distributed nature of the Internet to take the place of those third parties, allowing the participants and the shared ownership of the “block” to determine when value or records have changed between parties.
Designed to solve the problem of digital cash, the underlying deterministic properties of the chain and the transfer of records between participants, means that the applications it can be used for are far broader than just payments and currencies.
“Blockchain is today being used in a myriad of interesting applications, as it is able to guarantee digital ownership as well as transfer content without the duplication of the content associated with Internet sharing. The more we embrace the openness of new technologies like Blockchain, the bigger the business opportunity for all, but for many companies they still need to get past the traditional concept of data ownership,” ends Leppan.
Money talks and electronic gaming evolves
Computer gaming has evolved dramatically in the last two years, as it follows the money, writes ARTHUR GOLDSTUCK in the second of a two-part series.
The clue that gaming has become big business in South Africa was delivered by a non-gaming brand. When Comic Con, an American popular culture convention that has become a mecca for comics enthusiasts, was hosted in South Arica for the first time last month, it used gaming as the major drawcard. More than 45 000 people attended.
The event and its attendance was expected to be a major dampener for the annual rAge gaming expo, which took place just weeks later. Instead, rAge saw only a marginal fall in visitor numbers. No less than 34 000 people descended on the Ticketpro Dome for the chaos of cosplay, LAN gaming, virtual reality, board gaming and new video games.
It proved not only that there was room for more than one major gaming event, but also that a massive market exists for the sector in South Africa. And with a large market, one also found numerous gaming niches that either emerged afresh or will keep going over the years. One of these, LAN (for Local Area Network) gaming, which sees hordes of players camping out at the venue for three days to play each other on elaborate computer rigs, was back as strong as ever at rAge.
MWeb provided an 8Gbps line to the expo, to connect all these gamers, and recorded 120TB in downloads and 15Tb in uploads – a total that would have used up the entire country’s bandwidth a few years ago.
“LANs are supposed to be a thing of the past, yet we buck the trend each year,” says Michael James, senior project manager and owner of rAge. “It is more of a spectacle than a simple LAN, so I can understand.”
New phenomena, often associated with the flavour of the moment, also emerge every year.
“Fortnite is a good example this year of how we evolve,” says James. “It’s a crazy huge phenomenon and nobody was servicing the demand from a tournament point of view. So rAge and Xbox created a casual LAN tournament that anyone could enter and win a prize. I think the top 10 people got something each round.”
Read on to see how esports is starting to make an impact in gaming.
Blockchain is generally associated with Bitcoin and other cryptocurrencies, but these are just the tip of the iceberg, says ESET Southern Africa.
This technology was originally conceived in 1991, when Stuart Haber and W. Scott Stornetta described their first work on a chain of cryptographically secured blocks, but only gained notoriety in 2008, when it became popular with the arrival of Bitcoin. It is currently gaining demand in other commercial applications and its annual growth is expected to reach 51% by 2022 in numerous markets, such as those of financial institutions and the Internet of Things (IoT), according to MarketWatch.
What is blockchain?
A blockchain is a unique, consensual record that is distributed over multiple network nodes. In the case of cryptocurrencies, think of it as the accounting ledger where each transaction is recorded.
A blockchain transaction is complex and can be difficult to understand if you delve into the inner details of how it works, but the basic idea is simple to follow.
Each block stores:
– A number of valid records or transactions.
– Information referring to that block.
– A link to the previous block and next block through the hash of each block—a unique code that can be thought of as the block’s fingerprint.
Accordingly, each block has a specific and immovable place within the chain, since each block contains information from the hash of the previous block. The entire chain is stored in each network node that makes up the blockchain, so an exact copy of the chain is stored in all network participants.
As new records are created, they are first verified and validated by the network nodes and then added to a new block that is linked to the chain.
How is blockchain so secure?
Being a distributed technology in which each network node stores an exact copy of the chain, the availability of the information is guaranteed at all times. So if an attacker wanted to cause a denial-of-service attack, they would have to annul all network nodes since it only takes one node to be operative for the information to be available.
Besides that, since each record is consensual, and all nodes contain the same information, it is almost impossible to alter it, ensuring its integrity. If an attacker wanted to modify the information in a blockchain, they would have to modify the entire chain in at least 51% of the nodes.
In blockchain, data is distributed across all network nodes. With no central node, all participate equally, storing, and validating all information. It is a very powerful tool for transmitting and storing information in a reliable way; a decentralised model in which the information belongs to us, since we do not need a company to provide the service.
What else can blockchain be used for?
Essentially, blockchain can be used to store any type of information that must be kept intact and remain available in a secure, decentralised and cheaper way than through intermediaries. Moreover, since the information stored is encrypted, its confidentiality can be guaranteed, as only those who have the encryption key can access it.
Use of blockchain in healthcare
Health records could be consolidated and stored in blockchain, for instance. This would mean that the medical history of each patient would be safe and, at the same time, available to each doctor authorised, regardless of the health centre where the patient was treated. Even the pharmaceutical industry could use this technology to verify medicines and prevent counterfeiting.
Use of blockchain for documents
Blockchain would also be very useful for managing digital assets and documentation. Up to now, the problem with digital is that everything is easy to copy, but Blockchain allows you to record purchases, deeds, documents, or any other type of online asset without them being falsified.
Other blockchain uses
This technology could also revolutionise the Internet of Things (IoT) market where the challenge lies in the millions of devices connected to the internet that must be managed by the supplier companies. In a few years’ time, the centralised model won’t be able to support so many devices, not to mention the fact that many of these are not secure enough. With blockchain, devices can communicate through the network directly, safely, and reliably with no need for intermediaries.
Blockchain allows you to verify, validate, track, and store all types of information, from digital certificates, democratic voting systems, logistics and messaging services, to intelligent contracts and, of course, money and financial transactions.
Without doubt, blockchain has turned the immutable and decentralized layer the internet has always dreamed about into a reality. This technology takes reliance out of the equation and replaces it with mathematical fact.