There is great “excitement” about blockchain technology – although it is not yet really possible to estimate or classify its precise role for the economy and society. Even so, it does seem that the blockchain will fundamentally change economic and social systems.
Transactions, contracts and their recording are key components of our economic system. However, they have not really managed to keep pace with the digital transformation. Blockchain technology – an open, decentralized “log book”, which records and stores transactions securely, permanently and efficiently - now promises to solve this problem. Transactions between parties, companies and private individuals are digitally documented, authenticated and “perpetuated” in the database. This ensures that digitally represented transactions have taken place as documented and can no longer be changed.
On the bitcoin blockchain, all transactions made (transfers of funds) are stored in an unchangeable state. Here is an example of a transaction.
Source: blockchain.info (for illustrative purposes only.)
The experts consider the blockchain to be a fundamental technology – as the Internet also once was, or still is. The Internet (of information) changed the distribution and consumption of information. Blockchain technology could fundamentally change the way we conduct transactions (of any kind) between two or more parties.
Possible future applications of blockchain technology
Source: Frankfurt School Blockchain Center working paper, “Blockchain-Technologie: Vom Hype zur Wirklichkeit” (Blockchain Technology: From Hype to Reality)
Why an early investment could pay off
Many investors are convinced that the technology associated with the blockchain could become widely accepted – as the Internet once did. However, it should be noted that the technology is still at a relatively early stage in its development. A direct comparison with the Internet suggests that the blockchain could possibly take another ten years or so to become a widely used technology. Nonetheless, the technology has the “power” to fundamentally change the economy.
Further exciting topics around the Blockchain can be found at