Blockchain is a new technology that, for the first time, allows us to have true peer-to-peer transactions with no platform or middleman in between. The fact that person A and person B, who neither know nor trust each other, can make a value transaction without a trusted middleman is possible using blockchain protocol or smart contract.
How It All Started
It all started with Bitcoin. Bitcoin is an online currency that works without banks and without bank managers. This means that when I send you money, there is no classic intermediary entity like a bank to validate the transaction. The protocol on the peer-to-peer network is used to decide on the transaction by the democratic decision of all computers in the network.
If I have enough money in my bitcoin account and the recipient address really exists, the transaction will go through. Bitcoin can be seen as the first use case of blockchain, but the protocol behind Bitcoin can also be used for other value transactions. For example, ridesharing without Uber, flat-sharing without Airbnb or social networks without Facebook and Twitter would be conceivable.
Present Use Cases
The first application of blockchain is from the financial sector, which has made money transactions possible without banks. Bitcoin is based solely on a smart contract that ensures that I can send money from A to B without a middleman. There’s also Ethereum, a new platform, and the blockchain, which means I can build every conceivable smart contract.
Ethereum can be described as a decentralized world computer on which anyone with basic programming skills can program smart contracts, such as flight insurance without an insurance company or energy trading without energy companies. Actually, I can program any kind of application on it: in the energy sector, in the insurance sector or in the education sector. For example, there could be peer-to-peer education where I can pay for my tutoring directly online. It’s actually like the Internet: it affects all sectors.
Non-Financial Applications of Blockchain
Money is just an exchange of value, in general, it is about any kind of value transaction. It’s also mappable to do things over the blockchain without exchanging money. In the smart contract, the condition is defined as how much has to be paid for execution. The sum can also be zero. Perhaps other conditions must be met for this. Blockchain also works without money exchange.
In the academic field, there is currently a use case on the topic of peer review, “Blockchain for Science”. In the future, an author could put an academic paper online and anyone who meets the specified criteria can judge it for example, someone who already has a good reputation. The smart contract could also ensure that the rating of someone who has already rated ten papers is worth more than that of someone who has not rated a paper at all. If so provided, the reviewer’s remuneration can also be processed via the smart contract.
Academic and applied research is also an interesting area of application when it comes to testing and changing hypotheses. It is really a big problem that researchers first set up their hypotheses for a research project, but when results come out that do not correspond to the hypothesis, the hypothesis is changed afterwards. Blockchain is helpful here because the hypothesis is time-stamped on the blockchain and no one can falsify the original hypothesis afterwards.