Written By: Amy Trachter
The word Blockchain is like the car you're thinking of buying. You see it once and then start to notice it is everywhere. Someone once mentioned "Blockchain" to you and now it makes up 80% of your conversations.
Whether you work in finance, the public or private sector, one day probably soon you’ll hear about Distributed Ledger Technology (Blockchain technology).
New to the space? Things to know:
Cryptocurrencies = Blockchain, but Blockchain does not only = cryptocurrency
Distributed - everyone shares the same ledger of information (cryptographic proof)
Ledger - public list of technology based transactions (Ethereum)
Technology - coding, hashing, nodes, smart contracts etc which helps document transparent transactions
Problems Blockchain Solves:
Centralized Data - private data bases can hide transactions and add to corruption, while public ledgers allow for transparency
Third Parties - cut out the middle man, making business, and personal transactions more affordable and efficient
Human Error - with smart contracts and decentralization verifications human error is eliminated
Triple Entry Accounting - rather than each party having to record their own ledgers, creating double and triple entry accounting, transactions now happen with real time auditing
Don Tapscott, Co-Founder of the Blockchain Research Institute says "The future is something we achieve, not predict". As new technologies emerge, new industry leaders are adapting and creating new technology companies and adding more value to Blockchain DLT.
Industries Disrupted by Blockchain Use Cases
Finance, Insurance, Real Estate, Supply Chain, Legal, Environmental, Cyber Security, Education, Voting, IOT, Music/ entertainment, Health Care, Government, Charity and more.
Other terms you'll hear in this space
Initial Coin Offering (ICO) or Initial Token Offering (ITO)
Utility Token VS Security
Transactions - represent each agreement and smart contract deployed recorded on a blockchain
Digital Wallets (Jaxx Wallet)
Crypto Exchanges (Coinsquare)
Concerns of Fraudulent Blockchain Businesses
There are concerns in the media that ICOs and Blockchain startups are scams. These generalizations lead to advisors preaching due diligence before investing in a Blockchain startup or token sale.
Something to keep in mind is 90% of startups fail. This percentage will be the same when speaking about Blockchain based startups. Failure will be due to many factors, including unverified market validation, timeliness, technology itself, weak management team, and scalability. Yes, there are possibilities for scamming, but it is likely due to proper investing responsibilities that get overlooked.
Companies such as Outlier Compliance Solutions and The AML Shop help businesses comply with regulations and potential securities risks. There are also companies such as TokenFunder to raise funds within specific Ontario regulations.
Almost as fast as Blockchain is developing, Toronto is accelerating businesses to help prove DLT to be useful beyond the bubble that has been created.
Blockchain technologies will achieve solutions, create more questions to be answered, pivot businesses, disrupt industries, and create transparent organizations. 2018 is when Blockchain gets typed, and spell check won't suggest I mean block chain.