Blockchain Misunderstood

Blockchain Misunderstood

Certainly one of the most hyped phenomenons of the last 3 years has been Blockchain, or the compendium of technologies surrounding the notion of a distributed ledger.

There is a plethora of posts everywhere explaining Blockchain, saying how it is the next best thing, yet despite all the excitement and all the explanations, Blockchain remains misunderstood.

Most people confuse the term "Blockchain" and use it to mean "cryptocurrency" or other financial technology solutions, when instead Blockchain refers to the software capacity of having distributed data validated by a consensus algorithm.

If you are looking for info on how that works, there's great examples at the end of this article. But let's focus instead in the why. Why do you need a distributed ledger?

Why couldn't your project just use an easy to set up, scalable, on-demand database in multiple instances?

Is there a common good, or independent safeguarding that you are interested in doing? Or did you just gravitate to Blockchain because of the buzz?

The trend peaked in December 2017, when it seemed like Blockchain would just cure AIDS, fix and prevent all financial crises, and even rid us of our global political dissociative fugue.

Google Trends search for "Blockchain" over the past 3 years.

But thankfully, the noise has quieted down since then, and so have the number of irresponsible people outright scamming others by agitating the fumes of the Blockchain snake oil. In those episodes, Bitcoin was usually the culprit. There seems to be something about money that drives people to do insane things

Is Bitcoin the new Nigerian prince scam?

But when you look past the cryptocurrency waste land, there are very valid undertakings that exemplify a great use for deploying and maintaining a Blockchain. Such is the case of Hyperledger, which was introduced to me in an event in New York, in 2013. The pitch?

"This is the Linux Foundation trying to do for Blockchain what they've done for Operating Systems, with the help of IBM and Intel".

I was immediately interested. What the Linux Foundation did for Operating Systems is huge, and often overlooked. Linux, the open source operating system, has been "the other" voice for a while, but we forget that it was there at a time when Microsoft had no competition.

When Windows was an unavoidable, abhorrent creature and its creator had zero interest in innovation. At this moment, the Linux Foundation in their pre-existence version (an open source community built around Linux) made all sorts of things possible for us, like having an alternative web browser, and a framework to go with it, where others could improve upon and create their own products.

We would be living in a very different type of world if this had not happened. This even forced Microsoft to consider developing and contributing to open source Software, and it brought the notion of community back to the soul of a project.

Now, what if the Linux Foundation could do that with Blockchain, embracing this idea that technology that guarantees transparency is the property of humanity? What if we could all contribute to improving the underlying technologies that guarantee quality of life, like respect for the rule of law and factual accuracy?

This can be done with Hyperledger. There are many frameworks that differ based on needs and use cases, with tools to match. Anyone in the world can join these communities, obtain access to the code, engage in helping others or having their questions answered by experts. Isn't that what the Web is all about?

Interlink has been participating in Hyperledger Fabric development communities and is now in the process of joining Hyperledger.

There are now great open source projects stemming from Hyperledger, as members that engage with the community. Out of the first batch, the one that impresses me the most is The Accord Project.

They are an Associate Member of Hyperledger and a consortium of attorneys, technologists, and organizations collaborating to set new legal standards through their software called “Cicero.”

Cicero enables lawyers and business professionals to turn traditional, legally binding agreements into smart legal contracts. It accomplishes this through a system for enabling legal contracts to be executed in response to external data and be connected to a wide variety of software systems and platforms, including blockchain.

The “virtuous triangle” of functionality implemented by Cicero templates.

But I get it, as we see with The Accord Project, creating value with Blockchain involves real hard work. It is tempting for some companies and institutions that were otherwise dormant, to now appear exciting and futuristic by yelling "Blockchain!" every now and then.

It also offers the comfort of pulling a GitHub repository and passing it for work. Like saying "see all these years, you thought we were doing nothing, but we were working on this". The fallacy of advancement. The "us too" rationale for doing something. A terrible starting point.

So there are some institutions, especially those which should concern themselves with neutrality, transparency and being a guarantor rather than a transacting partner, which are out there touting Blockchain irresponsibly. Claiming to use an algorithm of consensus that rewards the processing of the Blockchain instances with cryptocurrencies.

This is wrong for a number of reasons, but the main one being that you cannot mix the need for a distributed ledger using data from people, where the Blockchain has members that support it on almost equal capacity to you, with your monetization strategy of being the product owner and rewarding your processing capacity with Bitcoin. It is absurd because you control how many nodes each member can have.

And it is also the reason why Hyperledger exists, so no one entity or organization out there can just hijack the concept of a Blockchain in order to mount a business that places value on obstructing, intermediating or setting up tollbooths. Companies that think this way should find other ways to make money. How about the cost and relevance of the associated service that you are trying to improve with Blockchain?

Hyperledger does this by not having a cryptocurrency component, and by having a thriving community. Leave the other bad initiatives to the speculators and the miracle-cure buffoons. Let's work on real solutions that have the ability to scale and improve lives.

Useful links:

A blockchain in 200 lines of code

Consensus Algorithms

6 Principles for Designing Blockchain Apps for Non-Technical Users