Five Things to Know About About Blockchain and Bitcoin
As innovative as space flight, as paradigm-shifting as the invention of the internet: blockchain technology is quickly becoming a topic that Millennials need to understand in order to make sense of the world. But blockchain technology is so unprecedented that many people don’t quite have the words to describe it.
“Being on the forefront of emerging technologies is like backpacking into a foreign country without knowing the language,” said Jessica Higgins, entrepreneur and marketing consultant. “It’s like Startup Land on 30 Adderals with a Red Bull chaser.”
You’ve likely heard of blockchain and cryptocurrency, but you might have questions about what exactly either of these terms mean and why they matter. A new podcast from Radiotopia called "Zig Zag" features two female entrepreneurs documenting their journey into the strange new world of cryptocurrency, with succinct and useful definitions for these confusing concepts.
They define the blockchain as a public ledger that allows people to record transactions and make deals in a new way, and they describe the three things you need to know about blockchain:
“It’s related to something you probably have heard of: Bitcoin. It’s a new way for humans to make deals with each other and it requires a collective spirit: think lots of people and computers all working together.”
They even wrote a song about it to make it easier to understand—and it’s very, very catchy.
I caught up with several people working in emerging technologies like blockchain and cryptocurrency who said they feel their work is sometimes misunderstood. Here’s what they think you should know about it:
Blockchain and Bitcoin are different
Don’t confuse the technology with the currency.
“The biggest myth is the opinion that blockchain and Bitcoin are one and the same,” said Maria Fomina, public relations manager at Futurama Blockchain Innovators Summit.
Cryptocurrencies sometimes give the blockchain a bad name, she said, because Initial Coin Offerings—which are campaigns to raise money for a new type of cryptocurrency—are so often scams. This has led to a lot of public skepticism.
Blockchain is about more than money
Blockchains record exchanges, and these exchanges are made with cryptocurrencies. In the current system of transaction records, we always need a third party to verify our identities and validate the transaction: a bank in order to access money, or a government official to validate your marriage certificate.
Blockchain technology eliminates the need for third parties. It puts people in control of their transactions and guarantees privacy. It has the potential to dramatically alter the way we understand and use money and to decentralize current monopolies.
This is especially cool for women. Blockchain technology has the potential to level the playing field by upending traditionally male institutions, like banks.
Molly Spiers is the marketing manager at CoinCorner, an online marketplace for buying Bitcoin with a credit card. She said she believes decentralization of currency in banks and corporations is where the blockchain will have the greatest impact.
But there are many other areas where favoring cryptocurrency can change the game. Emie-Claude Lamoureux at MLG Blockchain in Toronto is most excited to see its impact on sustainable development and food security in “blockchain projects that focus on provenance and energy distribution.”
Consider also the power of blockchains to record not just value transactions for the exchange of goods or services, but volumes of information: medical history, personal achievements, marital statuses. All of this information, stored in the blockchain, wouldn’t require a third party, like a government or a bank or an insurance company, to verify the identity of the people and the validity of their transactions.
It would record, in real-time, the trillions of transactions of human life.
There's opportunity for women to make a difference
“When I tell people about my work, it’s a mix of reactions,” Lamoureux said. “But the most common ones are skepticism, genuine interest and confusion.”
For those of us not yet involved in crypto, it can seem exclusive and intimidating, yet the women I spoke to agreed it’s a great opportunity to connect to future-oriented people who care about making positive change. As blockchain technology grows in availability and accessibility, women have the opportunity to develop a new relationship with money.
One of the most important aspects of blockchain technology is how it relies not on any centralized group for power but on a peer-to-peer network, and that it is powered by collective interests.
Fomina said that's the best part of her job.
“The transparency and uniqueness of transactions in the blockchain network is like the transparency and uniqueness in communication within our industry," she said.
It’s not the answer to everything
A big misconception is that “blockchain is the answer to everything,” Spiers said. It will likely disrupt our current system and create new opportunities, but it’s still based on a transactional system, and it's not perfect.
“The thing that makes me nervous is when we say that blockchains are secure and immutable,” Lamoureux said. “It’s like building a bridge—some are better than others. And so when these words keep being associated with it, followed by hacks in the news, it loses public confidence that blockchains can really work.”
Yet blockchains—and cryptocurrency—are already making a difference in the lives of women worldwide. One example is Fereshteh Forough's Code to Inspire project, which teaches women in Afghanistan how to code, use computers and find jobs in the tech industry, connecting them with the global economy.
…But it offers hope for change
Cryptocurrency might not be the end of money, but it’s a marked departure from value and money as we understand them today.
“It seems incredible that we might use cryptocurrency everywhere, but, after all, the flight into space seemed incredible many years ago,” Fomina said.
While we’re still figuring out how to talk about the blockchain, one thing is certain: It has significant potential to change our daily lives, to decentralize our data and to shift the power from a few hands to a bigger collective.
"Blockchain technology has empowered me and given me hope—hope that we can escape some of the worst trappings of late-stage capitalism where economic gains all flow to the top," said KJ Erikson, CEO of Public Market. "Blockchain has the ability to not only redistributes ownership, it also empowers communities to write their own rules."
Changes we can’t yet know or measure are still yet to come.
“(Blockchain) hasn’t changed my life (yet), but it has changed my perception of the future," Spiers said.