Webinar addresses bitcoin, blockchain confusion
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Professionals in technology-intensive industry such as digital signage, self-service, banking and mobile payments will have heard about bitcoin and blockchain by now. But they might not understand the distinction between the two. Blockchain seems to be related to bitcoin — a sometimes sketchy payment method — but also to tightly regulated traditional banking. Given the confusion about these technologies, we wanted to set down some definitions.
What's the difference?
In a webinar hosted by Digital Signage Today, a sister site to Blockchain Tech News, Doug Bannister, CEO and director of software development at Omnivex, addressed a few key differences between bitcoin and blockchain.
Bannister compared bitcoin and blockchain to email and the internet. Everyone thought email was a huge deal, but the engine that powered it — the internet — turned into a much bigger deal. The same could be said of bitcoin and blockchain.
Bitcoin is a virtual currency born out of the housing crash of 2008 and the Great Recession that followed it. By design, it is a decentralized currency, not controlled by any government, but instead "mined" and managed by individuals. These individuals lend their computer processing power to confirm bitcoin transactions and create new bitcoins.
Each transactions is recorded on a blockchain, the underlying technology of bitcoin. A blockchain is a decentralized ledger controlled by a decentralized network.
Any time a transaction is performed it is registered in a block on a blockchain. If an individual were to try to change a block in the blockchain, the network would correct it. This means the blockchain is both immutable and open. Anyone can look at it.
What's the big deal?
Bitcoin and other cryptocurrencies have the potential to serve the world's massive underbanked population. Bannister emphasized that in the West, we have relatively stable governments and markets and well developed banking systems. But in less developed countries, this may not be the case.
Bannister said that more than 2 billion people in the world are unbanked. But by using virtual currency, they can join the global market. They can also enjoy lower fees for remittances.
Blockchain, the technology underlying bitcoin, is of much greater importance to business and industry. Just a few of the myriad examples of its application include:
- use with digital signage to sell advertising space and make secure payments pay based on impressions or conversions.
- use in healthcare to consolidate and protect patient records.
- use in banking to transact irreversible bank-to-bank transfers.
- use for identity management and verification.
Why should I care?
Your organization or industry might not be involved with bitcoin or the blockchain currently, but that doesn't mean that it won't be in the future. For instance, Bannister said that Omnivex is examining the blockchain but hasn't yet developed any products that utilize it.
That said, it's essential to prepare for these technologies before they take off, because they are potentially disruptive to industries of almost every kind.
Bannister reminded the webinar audience that disruptive technologies such as online retail have radically changed how we buy and sell products. Retailers who joined the party late are struggling to catch up, and some have simply vanished.
Blockchain is now poised to have the same effect on the financial services industry, and other business and government sectors are sure to follow.
Bannister said that this is why research is essential, and why businesspeople must use all of the resources at hand to make sure they understand emerging technologies and how they can affect business.
Bradley Cooper is a Technology Editor for DigitalSignageToday.com. His background is in information technology, advertising, and writing.www