CEOs often ask me: “What is blockchain, and what impact will it have?” After tapping into Forrester’s research, here’s my answer.
Definition
Blockchain is a computer program that lets two parties exchange value in a trusted and verifiable way, even if they don’t know or trust each other. Depending on the type of blockchain, that value could be cryptocurrency, food, messages, information, digital art, or real art. The important fact is that the programming, through its design and use of encryption, can guarantee transactions without having to verify the dependability or trustworthiness of the sellers and buyers. I like this quick video I found on YouTube that explains the rudiments of how blockchains work.
Three Realities
Definition
Blockchain is a computer program that lets two parties exchange value in a trusted and verifiable way, even if they don’t know or trust each other. Depending on the type of blockchain, that value could be cryptocurrency, food, messages, information, digital art, or real art. The important fact is that the programming, through its design and use of encryption, can guarantee transactions without having to verify the dependability or trustworthiness of the sellers and buyers. I like this quick video I found on YouTube that explains the rudiments of how blockchains work.
Three Realities
- Blockchain appears to be sexy. Utopianists, tech-hipsters, libertarians, entrepreneurs, tech-artistes, preppers, and other players (criminal and not) have flocked to the tech. Why? Because they see it as, in no particular order: a way to destroy Facebook, Google, and the rest of “Big Tech”; a way to escape the control of “Big Banks,” “Big Insurance,” “Big Government,” “Big Whatever”; a way to get rich quick; or a way to reconstruct society into a freer and user-controlled form, using code. The favored narrative is that the Web was stolen by the Amazons of the world and can now be taken back by blockchain through the elimination of the middleman.
- Blockchain is not sexy. Two problems: 1) Someone must maintain the blockchain and 2) The tech is complex. The former factor means that you either have to concoct expensive schemes like mining to incent people to maintain the network or you must include a transaction fee structure in the blockchain. These costs are unpredictable and difficult to administer. The second factor, complexity, means that dreaded middlemen are all over blockchains — from the programmers that created them and can change them, to entry ramps like Coinbase and FTX, to third-party services like OpenSea, Infura, and Alchemy. And that’s not including the ecosystem rent-seekers like Gisele Bündchen who get paid to sponsor, entrepreneurs who are attempting to generate quick wealth off a technology that is supposed to be “for the people,” and the venture capitalists like Andreessen Horowitz and Peter Thiel who cheerlead to create a new funding segment.
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Continue reading: https://www.forbes.com/sites/forrester/2022/07/13/blockchain-for-ceos/?sh=6a110cfd382a
