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In 2015, many mainstream financial institutions in Europe and America , including Nasdaq, tried the blockchain technology. When it comes to blockchain technology, you may be unfamiliar with this term. But if you know Bitcoin and its principle (it doesn’t matter if you don’t know, I will explain it below), you will suddenly realize it.
Blockchain became popular five years after Bitcoin came out. Its underlying blockchain technology has gone from being an experiment by a small group of liberal cryptographers and computer hackers to a new hot spot for investment by high-tech companies, multinational financial institutions and venture capital funds.
The latest news is that Microsoft announced that it will join hands with the R3 blockchain alliance to develop and test a new technology for major banks and enterprises to replace the old systems currently in use and improve the efficiency of their systems. It is reported that Microsoft hopes to enable its partners to expand the use of Blockchain-as-a-Service through Azure cloud services and make this transformation process faster.
These industry giants who are increasing their investments in blockchain startups (such as Blockstream) are looking forward to future benefits, and blockchain will therefore become the most important trend that cannot be ignored in 2016.
Today, Moore contributor @Shengjie Capital will describe the magic of blockchain in simple words. More importantly, we will explore the investment opportunities behind it. Currently, there are not many A-share companies involved. In addition to the few companies announced in the announcement, listed companies in the fields of mobile payment, financial Internet , big data, etc. may also join the blockchain research in the future. So, prepare in advance and wait for the harvest.
Blockchain technology is expected to become another disruptive revolution after VR. With its distributed, decentralized, tamper-proof, open and transparent features, blockchain will have a revolutionary impact in many fields such as finance, the Internet of Things, legal affairs, and medical care.
Although it is still in the early stages of venture capital investment, we must not turn a blind eye to this technology. Financial institutions in the future can only actively embrace this technology, otherwise they will be at a disadvantage in the competition.
At present, there are not many A-share companies that are actually involved. In addition to the few companies announced in the announcement, listed companies in the fields of mobile payment, financial Internet , big data, etc. may also join the blockchain research army in the future.
Blockchain definition:
Blockchain is a term proposed by the father of Bitcoin, "Satoshi Nakamoto" (pseudonym, his real identity remains a mystery) in a 2008 paper "Bitcoin: A Peer-to-Peer Electronic Cash System". It is a brand-new distributed data structure.
The basic logic of blockchain is to use a series of cryptographic methods to generate data blocks. Each data block contains information about all Bitcoin network transactions in the past ten minutes, which is used to verify the validity of the information (anti-counterfeiting) and generate the next block. Simply put, you can imagine it as a huge network of data packets. The next data packet will contain all the information of the previous data packet and new information, and then pass it to the next block. When it comes to Bitcoin, some people know it and some may not have heard of it. But even if they have heard of it, not many people have actually read the above paper. Here is a brief introduction to the past and present of Bitcoin.
The history of Bitcoin
Theoretical basis of Bitcoin
In the early 20th century, the Austrian School of Economics first fully expounded the concept of a denationalized non-sovereign currency. Representative works: Hayek 's "The Denationalization of Money", which can be considered the earliest theoretical origin of Bitcoin. But at that time, cryptography, computers and the Internet were not powerful enough to realize such a concept from a technical or programming perspective.
The Birth of Bitcoin
In 2008, "Satoshi Nakamoto" published "Bitcoin: A Peer-to-Peer Cash System" on the cryptography mailing list of metzdowd.com. On January 3, 2009, the Bitcoin network was born, and Satoshi Nakamoto himself released the first open source Bitcoin client.
Then, Bitcoin and blockchain were born.
The open source nature of Bitcoin means that the Bitcoin network will only become more and more perfect and powerful, and will never be destroyed. Moreover, I would like to add that many aspects of human society will change from now on.
Bitcoin Generation
"1dDe12weQwUwr13jMsdFJi3fdjs4nfgu8" is a Bitcoin. Each Bitcoin is about 33 bits long and is a string of letters and numbers, always starting with 1 or 3.
The principle of Bitcoin generation is actually very simple. It is actually to set up a set of complex algorithms. This algorithm has a certain number of special solutions, and each special solution is a Bitcoin. If compared with RMB, each special solution is equivalent to a set of serial numbers on RMB.
Bitcoin also provides a technical possibility to solve a major nightmare in the economy through its rigorous generation algorithm: inflation caused by excessive money supply. This is mainly due to the decentralized programming used in the Bitcoin system. The special solution of the initial Bitcoin algorithm is only 21 million, so the upper limit of Bitcoin in circulation is locked at 21 million. According to the design of the program, by 2140, the upper limit of Bitcoin in circulation will reach 21 million. This was stipulated at the beginning of the design and cannot be changed by any individual or any institution, whether you are the chairman of the Federal Reserve or the central bank. Mathematics and algorithms ensure that there will be no inflation caused by excessive money supply.
Crazy Bitcoin
At first, only a few people were testing Bitcoin transactions, and each Bitcoin was worth only 5 cents. Then, it gradually expanded from a small geek circle to many people outside the circle. After gradually gaining public recognition, it soared to a historical high of $1,124.76 in 2014, with a historical increase of more than 220,000 times. Although there was indeed a lot of malicious speculation by speculators behind the sharp rise at that time, and it did experience a bubble burst later, as long as the direction of progress is correct, don't be afraid of setbacks along the way. At the end of 2015, Bitcoin went through another wave of doubling. I don't know whether the reason behind this surge was that investors saw the huge energy behind Bitcoin's underlying technology, blockchain. As of now, the price of Bitcoin is around $420. Is Bitcoin Legal? How to Trade It?
At present, it is legal for individuals to trade Bitcoin in China, and they can treat it as a commodity. It is similar to the way we buy and sell stamps, antiques, and calligraphy and paintings. Generally speaking, Bitcoin transactions are divided into on-site and off-site transactions. Most people can complete it through on-site transactions, that is, domestic or foreign exchanges. At present, there are about three large-scale exchanges in China, and they are all legal and compliant. In order to avoid suspicion of advertising, I will not go into details here.
To date, Bitcoin remains the most widespread and successful application of blockchain.
Blockchain is catching up and emerging
After the Bitcoin price bubble burst, more and more institutions and experts have noticed the technology behind Bitcoin, which is blockchain. And the keen-eyed and insightful venture capitalists have become more enthusiastic about blockchain.
So what are the advantages or characteristics of blockchain?
The essence of blockchain
The essence of blockchain is an open, transparent, decentralized value transfer network. This sentence can be read three times, although I only said it once. If the Internet is a global information transfer network, then blockchain is a global value transfer network. And it is an open, transparent, decentralized network that cannot be forged or tampered with.
If TCP/IP is the underlying protocol of the Internet, then blockchain can also be seen as an underlying value transmission protocol. With it, value can be transmitted around the world around the clock. This value includes monetary value, but the scope goes far beyond this.
Next, I will explain in detail the major characteristics of blockchain: openness, transparency, decentralization, and immutability.
Openness and transparency:
The blockchain is like a huge ledger that records all Bitcoin transactions. In other words, we can see all transaction records on it. Not only our own, but also others', not only our own, but also foreign, not only today's, but also the first transaction record since the birth of Bitcoin. All on the blockchain. So, in fact, many people associate money laundering with Bitcoin, which can only be said to be not very familiar with this technology. Most of the money laundering methods in the world are more secretive and more convenient than Bitcoin. Bitcoin can achieve this goal, but in actual operation, it is much more complicated. Because every transaction has its own cause and debt, and it is linked together.
Decentralization:
Blockchain is a decentralized network. In simple terms, it does not rely on a single company or individual. This determines the reliability of the network. There are countless clients running this program around the world, and no organization or individual can terminate the operation of the network.
Cannot be tampered with:
The blockchain uses mathematical and cryptographic algorithms to ensure that each Bitcoin is unique, just like the serial number on the RMB, which is unique and cannot be forged. Strictly speaking, banknotes can be forged, but the value on the blockchain (such as Bitcoin) cannot be forged.
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