Bitcoin’s inadvertent revolution

Bitcoin has made headlines in recent months for hitting brow-raising gains that have piqued even the most traditional investors’ interests. But the successful cyber currency had humble origins. In 2008 a link to a paper detailing the rules governing Bitcoin was posted in a cryptography mailing list. Bitcoin would allow users to bypass banks and other financial institutions when transferring money.

But the implications of this technology went further than anyone expected. Behind all Bitcoin transactions is a blockchain, a digital data record of transactions that is instantly updated and shared by users around the world.

Blockchain, the backbone of the currency, would silently revolutionize the business world.

Crushing Corruption

Beyond Bitcoin, the creation of blockchain had important ramifications for government accountability. Unlike other digital records, blockchain does not house its information on a single server or computer. Whereas a well-placed bribe could erase government records, or alter the results of a contracting bid, information placed on a blockchain automatically becomes part of a public record that can be updated but never erased. Governments around the world have been quick to catch on to the transparency implicit in this technology. Dubai, for example, hopes to transfer all government records to blockchain by 2020.

Increased Productivity

Blockchain can also slash paperwork and bureaucracy. Because on a blockchain every user shares access to a document, updates are automatically delivered to each user. Users in separate silos of a government or business will be able to access and alter documents in real time– without the back and forth of emails and letters. The technology seems tailor-made for universities, which have been quick to jump on the blockchain bandwagon. The Massachusetts Institute of Technology, for example, uses blockchain to allow researchers working together on a project to share and analyze data.

More Security

By its very nature, blockchain technology makes data impossible to hack or steal because it is split amongst thousands of servers. That translates into safer financial transactions, but it also provides a refuge for a client and proprietary data. By securing customer data, blockchain can reduce costs associated with fraud, theft and compliance. Nasdaq has even created a blockchain based platform to securely manage issuance and transfer of shares in private companies.

The revolutionary technology behind bitcoin has thus reduced the latency, risk and cost of doing business in the 21st century.

Marina Lopes is a freelance reporter and producer covering technology, politics and economy. Her articles and videos have appeared in the Washington Post, the Chicago Tribune, the BBC, NBC, and the PBS NewsHour.
Marina holds a graduate degree in journalism from Columbia University and a bachelor’s degree in International Relations from Boston College.

She speaks Portuguese, Spanish, English and French.