Hi welcome to another funb article shortly after the 2008 global financial crash a mysterious white paper emerged from an unknown entity a person or group calling themselves Satoshi Nakamoto in this mysterious white paper a new peer-to-peer financial system was discussed it was to use a digital cryptocurrency called Bitcoin it was an omen to people being sick of centralized power meddling with economic systems many perceive this new system as a better way of doing things the technology invented to power this new system was called blockchain and nakamoto's paper was its grand unveiling in this article we'll talk about some exciting implications of this technology and the impact it could have on all of our lives so what is blockchain it's the underlying technology behind crypto currencies like Bitcoin and etherium but its uses go far beyond thatit all sounds complicated but let me try and break it down to one sentence an
important concept that you need to
remember simply put blockchain is a
continuously updated record of who holds
what these records are split into linked
blocks and then secured using
cryptography the cryptography part just
means that you can be sure about the
records this is dubbed as automated
trust or trust that's inherently built
into the system the list of Records
known as a distributed ledger is
decentralized and available to everyone
to see and verify in addition the
blockchain is tamper evident and
unhackable
due to its distributed nature everyone
knows when a block has been messed with
because it is rejected by the rest of
the system if you want to know more
details I've already done video about
the basics of how blockchain works in
regards to crypto currencies I'll leave
that video and other information sources
in the description below blockchain has
a social perception strongly related to
Bitcoin and other cryptocurrencies and
most people view the blockchain is
something for intellectual tech savvy
criminals all people that are anti-gay
but the emerging truth is that the
blockchain has applications far beyond
Kryptos and as a whole will be nothing
short of revolutionary I've invited dr.
Adrienne McCullough a blockchain lawyer
who's at the cutting edge of what's
going on in the industry to speak to us
today all right
I'm a lawyer of 30 years experience I'm
the only lawyer with a PhD in IT
security my thesis involved technical
analysis of digital signatures and hash
algorithms which happens to be the
underlying technology for blockchain so
a blockchain is just a special type of
data repository that is in itself tamper
evident blockchain technology has been
called the next stage of the internet by
many but I believe that this is now the
next generation of the Internet and that
it holds vast promise for every business
every society and for all of you
individually let me break it down our
current Internet is an Internet of
information it's based on the concept of
copying and distributing information be
it video email or data all of these are
copies for example if you want to watch
a video on YouTube or receive an email
you're looking at a digital copy of the
original but what if we take this
further to the next stage
what about assets that provide real
value like contracts such as a house or
car ownership a stock a bond money votes
or digital identities the problem is you
don't want to have these things as
copies for example you don't want to
send someone $5,000 yet still have the
original $5,000 under your name this was
called the double spending problem by
cryptographers despite the name this
basically means the problem of having
two digital copies of something that
should only have one unique identity the
cryptography element of the blockchain
enabled it to be the first technology of
its kind to solve the double spending
problem now for the first time we can
build a new stage of the Internet based
on real value
and this is partly why it's such a big
deal so where can the blockchain be
applied in my talk with dr. Adrienne he
discusses the fits model of blockchain
application fitness is an acronym using
this model the best placed his
blockchain are places with high
possibility of fraud an intermediary or
middleman environments with high
throughput and stable data I'll let dr.
Adrian explain further
um you should try to run against your
environment what's called the fits model
if i TS the fits model stands for F
stands for fraud if you are in an
environment where there is a history
propensity likelihood of fraud involved
in various transactions then the
blockchain can assist in reducing the
likelihood of fraud actually occurring
adrienne goes on to say that this is why
blockchain is being used for
international finance transactions the
next area of the fits is the i if you
have an environment where there are
intermediaries involved then you may be
able to disintermediate those parties if
they really don't provide value he goes
on to say that we can get average
transaction settlement times from two
days down to 15 minutes by taking away
middlemen
three put or number of transactions per
second is another consideration it turns
out that Bitcoin can only do ten
transactions per second while MasterCard
and Visa can do about eighty thousand
but researchers are currently looking
into increasing the throughput you then
look at things which what Vincent
Grimaldi from the University of New
South Wales has developed he's been able
to increase the throughput to four
hundred thousand transactions a second
through what's called decentralized
Computing's using a hundred laptops PCs
to do the processing power and next is
the stability of data for a blockchain
application you don't want volatile data
you want things that are going to stay
the same for at least a while things
such as land ownership titles and
personal information so that's the
theory about what systems you should
look for in regards to using blockchain
applications but where is the blockchain
actually being used today here's a quick
fire round of applications underway
blockchain land registries are being
looked at in Honduras and Sweden
diamonds are looking to be tracked by
the blockchain to stop things like blood
diamonds the Nasdaq Stock Exchange will
soon begin a blockchain system to record
the trading and privately held companies
the Bank of England has stated that the
blockchain is a significant innovation
that could have far-reaching
implications in the financial industry
not only this but six banks including
Barclays credit Swiss and HSBC are all
planning on making a single digital
cryptocurrency to clear and settle
transactions using the blockchain
Microsoft is even getting in on the
action by building a framework using the
etherion blockchain on the social media
front the steam it a reddit competitor
and this video companion D tube a
YouTube competitor both are blockchain
based platforms where you can get paid
in cryptocurrency for creating content
this is showing a new direction and
where social media could go as a matter
of fact I've actually just signed up for
steam at myself okay so this is all good
but let's turn things up a notch
blockchain goes even further when we
talk about something called a
decentralized autonomous organization a
Dao or Dao for short because of
blockchain technology we now have the
capability to create huge company
organizations that are distributed and
automated for the first time in history
this has never been done before and
could provide near limitless potential
before the blockchain we were already
halfway there we have organizations like
YouTube that are a mix of the old-style
Central Management with a decentralized
user base creating content add our would
have computer code that runs the rules
and decisions instead of a central
management team at the top the people in
the decentralized network would decide
on the rules form a consensus and create
something called a smart contract
basically a set of computer coded rules
that a computer would execute later when
needed in other words
adèle is like a democratic company
that's automatically run so a Dao is
meant to be a decentralized so it's on
the blockchain there's no central
management involved autonomous in that
the code will run the transaction and
it's meant to be some form of
organization the difficulty from a legal
perspective is that no one at this point
in time has been able to classify
exactly what a Dell is it may be that in
a few years time Dow's will become so
popular that legislators will need to
create special legislation that will
recognize what a Dell is but at this
point in time
no one knows let's take a look at a
basic hypothetical example of how this
might work but just with one smart
contract so say in the future when the
blockchain is readily established you
want to
I used a Tesla Model 3 traditionally you
go to a dealer or an individual you'd
make sure that the details in the
history of the car are correct
you'd has all for a price of the seller
takes the money out from the bank
transfer the money signed a lot of
paperwork wait for the money to clear
and then you can finally have the car
this will take around a few days to do
now with the blockchain using a smart
contract you could have this order all
carried out in real time the car would
be uploaded to the blockchain so that
you would already know that the details
are correct because Trust is built into
the system you could buy this car with a
cryptocurrency that's attached to your
bank account and all of the ownership
and other details about the car is
executed in a smart contract so
everything would happen in a matter of
minutes instead of days your ownership
of the car is now attached to your
digital identity on the blockchain the
global records in the blockchain system
is now updated so that everybody in the
system now knows that this car was sold
to you you can take all of this a step
further by linking up different smart
contracts into an organization similar
to Airbnb or uber so the whole process
is automatic with rating systems of
service and customer satisfaction etc
although that setup is a sharing economy
model according to dr. Adrian a group of
smart contracts can easily be arranged
in this way so I hope that you're
beginning to see the importance and
potential of such technology but it's
not all roses right now there are still
some downsides malicious smart contracts
for example these can theoretically be
designed to clog up the entire system in
addition if there are actual coding
errors within a decentralized autonomous
organization itself this could create
massive problems another thing is that
the blockchain is also permanent every
record of a transaction is stored there
for all time and this doesn't sit well
for those concerned and privacy and the
right to be forgotten dr. Adrian did
state that there are going to be some
entity is called Oracle's and these guys
have special clearance to make edits on
the blockchain but overall this is still
an issue that needs further looking into
as I tell people you know when we talk
about blockchain and we talk about dolls
and icos and things of that nature
we are at this stage in the blockchain
ecosystem probably the equivalent of
1993 when the internet was opened up by
President Clinton in the National Science Foundation prior to 1992 the
internet was only open to research organizations government agencies defense contracting organizations who would have thought in 1992 that we would have companies like Google Amazon all of
those companies have taken advantage and looked at the internet and said how can
I use this piece of technology I have no idea what some really smart masters PhD student is going to do and
say we could use the blockchain or smart contract or a doubt to do this may come from the University of Queensland Curtin University in W a Stanford you know who knows what someone is going to think about in the future and say wow we can use this technology to do this I don't believe it's going to be me I'd love it to be me but there will be some smart
people out there who will look at this
technology and say let's do this and the
rest of the world say wow that's really
something I want to get on board and I
want to utilize that service so while
everyone's focused on the buzz of
artificial intelligence I really think that the blockchain is a dark horse
that's going under the radar mainly because it's not as a romanticized and the concept is a little bit harder to
the grasp regardless blockchain is the next step of the Internet a complete overhaul of
how things in our world are going to be recorded organized and run in the end I personally think it's going to be a combination of artificial intelligence and the blockchain that will be our future so what do you guys think are you looking forward to things changing in this way or hesitant let me know your thoughts below also if you know someone that's going to be interested in this topic feel free to pass this video along to them anyway that's it thanks for watching if you've just stumbled across this channel feel free to subscribe this has been - go go you've been watching funb and I'll see you again soon for the next article
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