high level intro to blockchain
TRANSCRIPT
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High Level intro to Blockchain
Konstantins Vasilenko
COO, Co-Founder @ Paybis.com
Board Member of Latvian Blockchain Association
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What is Blockchain? What is Bitcoin?
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A digital ledger used to record all
transactions made in bitcoin or another
cryptocurrency
Chronologically
Publicly
Permanently
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Decentralized money (analogy)
Yap is a nation in the South Pacific,
living on a set of Islands
Rai stones – Used for exchange
circular stone disks that can be up to
3.5 m in diameter and weigh up to
4000 Kg!
Trading stones of this size is
difficult
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Centralized Ledger
Write down every transaction in a book
called a ledger
Bookkeeper appointed
Alice pays Bob 10 lbs of Rai,
Alice goes to bookkeeper’s house and announces
the transaction.
Everything worked well for a while, but
gradually, problems appeared:
Fee’s, Availability of Bookkeeper,
Corruption
Centralization of Power
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Decentralization and More Trust
“trustless”
Decided to find a new way
Every family would maintain its own ledger!
Alice pays Bob 10 lbs of Rai,
Alice announces the new transaction to all other
families.
Each family would then check their own ledger
No a single family had more power than any
other!
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To Centralize or Decentralize?
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What is Mining?
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What is interesting in Blockchain?
The interesting things in Bitcoin Blockchain are:
It’s Open (Anyone can access it)
Immutable
No need to ask for any permission (Permissionless)
Borderless (like internet)
Neutral (race, religion, wealth agnostic)
Decentralized
Censorship resistant
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Other Blockchains and Altcoins
1500+ and counting
Some are Currencies
Dash, Monero, Litecoins, Ripple, etc…
Some represent Company/Project Shares
Steem, Augur, Decent, Iconomi, etc…
Some are Platforms - Ethereum
Imagine Public Cloud for Programmers
Smart Contracts – legal contracts represented
by Code
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Invest in Bitcoin? Altcoins? Blockchain?
Bitcoin! Maybe? 500’000$ by 2030? At your own Risk.
From 1500+, 90% are worthless or Scams (“Scamcoins”)
“Buy MEGA Coin, earn 100% daily, bla bla” - SCAM
Invest your time to understand it, get the skills,
understand industry, innovate, make a career or
startup, an opportunity for you as an individual
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Types of Blockchains
Public blockchainAnyone can use it, send transactions, participate, explore the blockchain,
validate it.
Example: Bitcoin, Ethereum
Consortium blockchainControlled by a pre-selected set of nodes; for example consortium of 15
financial institutions, each operates a node. The right to read the blockchain
may be public, or restricted to the participants.
Example: R3
Private blockchainPermission management is kept centralized to one organization. Read
permissions may be public or restricted to an arbitrary extent.
Examples: Eris Industries, Multichain
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Blockchain in Finance and Banking
The question remains, will Blockchain technology revolutionize
the finance and legal industries in the same way the Internet
changed the media industry, once and for all?
R3 (R3CEV.com) 80 of the world's leading financial institutions
and regulators joined
Use Cases:
Payments
KYC/AML & Records Management
Asset Management (“Bank coins”, e.g. Fedcoin, Cadcoin)
Smart Contracts (Automation of Legal Agreements, Automated Payments)
Lending, issuing letters of credit, factoring, export credit and insurance.
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Blockchain in Public Sector
“The part of an economy that is controlled by the state.”
State Registers
Various Public Archives
Company registers
Various Government Datas
Distribution of grants
Land Registers
E-Residency
E-Health
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Blockchain in Logistics & Supply Chain
The blockchain has the potential to transform the supply
chain and disrupt the way we produce, market, purchase
and consume our goods
Share your product’s journey and your business impact on
environment and society.
Follow the movement of pork in China with a blockchain.
Track mineral analysis done by outside vendors
identifying data on a million individual diamonds to a blockchain
to comply with regulations barring “blood diamond” products.
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And many more areas
Crowdfunding (ICO’s, Decentralized Markets)
Governance (elections, polls)
File Storage
Prediction markets
Protection of intellectual property
Internet of Things (IoT)
Stock trading
Web 3.0?
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Try out Blockchain
Hyperledger
open source cross-industry blockchain technologies hosted by The
Linux Foundation,
Open Chain, Multi Chain, Chain.com
Open source technologies for custom Public and Private Blockchains
Ethereum
Ethereum is a decentralized platform that runs smart contracts
Counterparty.io
open source, create own Crypto Currency, runs smart contracts
Blockcypher
Bitcoin Blockchain Web Services and API’s
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Why Companies and Governments Invest
in Blockchain? Main Drivers:
Efficiency (e.g. Santader estimates $20Bn / year in savings)
New Businesses (e.g. digital trades between financial
institutions)
Ecosystem (e.g. removing redundant Ledgers between
banks, regulators, state orgs.)
Main Challenges:
Collaboration
Regulation
Integration
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Hype?
Gartner:
blockchain will
come to be
"transformational"
across a variety of
industries, in 5-10
years away from
now
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BLOCKCHAIN became an Industry by it self
Companies: We want Blockchain, red one please!
Consultants: Yes We Can! More $$$ please
Silicon Valley - goto random hotel, switch off lights, stand in front of mirror and say blockhain 3 times –
10 VC’s will jump out and throw millions of $$$ at you
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Google Trends
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