Is Blockchain all it’s cracked up to be?
Decentralized platforms seem to rely on Blockchain to operate successfully. Because of this, the interest and investment in this type of technology continues to increase at a seemingly astronomical rate. It does solve an endless amount of problems, right? Well, maybe not so much.
So,what exactly does this new kid on the block(chain) actually offer people? Its touted as the leading and most advanced distributed and immutable ledger. In addition, it allows for the easy creation of database management systems (DBMS).Also, whatever records are stored cannot be changed and will be there until the end of time.It addition, it appears to be the foundation on which the most well-known Cryptocurrency, Bitcoin, was built.
However, there are a few issues with these achievements. With regard to the ledger, your usual brick-and-mortar banks offer the same services and also have distributed ledgers, which can store information for an indefinite period of time. In addition, banks also have DBMS that offer a variety of replication services. Bank ledgers are also immutable, or unchangeable, same as blockchain.
Blockchain also seemingly allows for quick transaction times for Bitcoin. However, most of the DBMS used by banks can move money between two accounts in less than a second. Actually, these systems can do this thousands of times in just one second. With Bitcoin, and by extension Blockchain, this process can take up to 10 minutes for just one transaction.
So, Blockchain is the foundation of Bitcoin, right? The perception is that Blockchain doesn’t need Bitcoin, but the currency definitely needs blockchain. It’s not as simple as that. The whole process is synergistic, meaning that all components need to work together to get the job done properly. Just like a great, big machine needs all of the different cogs working together.
How about using a cheeseburger as an analogy? The whole delicious burger with its buns, patty, cheese, tomato and lettuce is Bitcoin. The burger buns are blockchain, definitely the foundation on which our Bitcoin burger is laid. However, if you remove all of those tasty fillings, you’re just left with two dry buns. It’s something alright, but a definitely not a delicious burger. The buns are an important part of a cheeseburger, but it’s not the only part.
That being said, Bitcoin is actually the component that’s pushing blockchain technology forward.
Speaking of which, Bitcoin offers plenty with regard to the future of money. We know that it’s a virtual currency, and that it isn’t controlled by one entity. Also, it uses miners to insure the security of transactions by rewarding them with lucrative Bitcoins.The only reason that the currency uses a distributed ledger is so that no one person or company controls it.
By removing both the currency and the miners, you’re left with an extremely unsafe ledger, decades behind other DBMS with regard to technology and performance.