Blockchain originated from Bitcoin, but it cannot stop at Bitcoin

The bigwigs of the financial world are throwing money at a technology called blockchain.

The blockchain has to start with Bitcoin. I first came into contact with blockchain in October last year when I browsed a Bitcoin-related consulting website. At that time, my understanding of blockchain was only superficial, that is, it was a technology that came out with Bitcoin.

But it seems that this year blockchain has stepped out of the halo of Bitcoin, and discussions about blockchain have appeared in many fields, especially the "decentralized" feature has been sought after by many parties. In addition to providing more inspiration in value transfer, it can also transform the Internet that we have become inseparable from.

Originated from Bitcoin, but not limited to Bitcoin. Nowadays, the application scenarios of blockchain have been greatly broadened, which is applicable to both centralized and decentralized scenarios. Finally, we still need some driving force, and the effect brought by the combination of industry, academia and research will not disappoint you.

A blockchain is just a block of data

Blockchain is the core innovation of Bitcoin. Wikipedia explains blockchain as follows: Blockchain is a distributed database system based on Bitcoin and participated by nodes. It can also be understood as a ledger system .

To put it simply, a blockchain is a data block generated by cryptographic methods. Each data block contains information about all Bitcoin network transactions in the past period of time, which is used to verify the validity of the information (anti-counterfeiting) and generate the next block.

Satoshi Nakamoto's white paper mentioned that the first block was created in 2009 , namely the "Genesis Block", which is also the starting point for any block chain tracing back.

Why is blockchain a thing of profound significance to security? Because it is unchangeable and unforgeable.

This is reflected in the hash value in each block . Each block contains the hash value of the previous block, connecting from the genesis block to the current block to form a block chain. Each block is guaranteed to be generated after the previous block in chronological order, thus solving the double-spending problem without a third-party agency.

Blockchain is not a specific technology. It can be implemented through many programming languages ​​and architectures. There are many ways to maintain blockchain technology. The most common ones include POW ( Proof of Work ), POS ( Proof of Stake ), DPOS ( Delegate Proof of Stake ), etc.

Blockchain can be said to be another engine for network transformation, especially in the financial world. Goldman Sachs, JPMorgan Chase, Citibank, HSBC, etc. have begun to deploy blockchain technology and industry.

Decentralized Next Generation Internet

Now that we understand the origin and benefits of blockchain, the next question is how to use it.

As the fruit of human civilization, the Internet has far exceeded initial expectations. In particular, the transfer of value requires a center to endorse it, while blockchain technology can achieve decentralization and strike a balance between freedom and order.

In the view of Li Xiangning, deputy director of the Information and Communications Administration of the Ministry of Industry and Information Technology, technologies such as "distributed trust" and "smart contracts" represented by blockchain have the function of promoting the transmission of next-generation network information value and credit through traditional networks.

This also allows the four characteristics of blockchain, decentralization , trustlessness , collective maintenance , and reliable database , to bring a lot of inspiration to the next stage of development of the Internet.

Let's talk specifically about "decentralization". Li Xiaodong, director of the China Internet Information Center, once said that the Internet was originally created for decentralization, but as the Internet became more and more important, many centralized features increasingly constrained the development of the Internet.

Experts around the world are putting forward a concept that the future of the Internet is a decentralized process, but decentralization must also ensure the stable operation of the Internet. So while the Internet has become a value transmission network, all of this depends on technological innovation, which has also become an opportunity for the development of blockchain, making the Internet both safe and controllable.

Multiple applications beyond Bitcoin

Blockchain originated from Bitcoin, but it cannot be limited to Bitcoin. However, any technology needs to go through a process from birth to maturity and then to widespread application.

Zhou Xiaochuan, governor of the People's Bank of China, said a few days ago that blockchain technology currently occupies too many resources, both computing resources and storage resources, and cannot cope with the current scale of transactions. Whether this problem can be solved in the future remains to be seen.

This is mainly talking about the financial level, but from a foreign perspective, EY data shows that the relatively leading blockchain companies are currently distributed in 13 major application areas, and the leading domestic blockchain companies are distributed in seven areas. In terms of investment amount, wallets, payments, and foreign exchange attract the most investment, followed by public services and information.

Distribution of China's blockchain high-tech enterprises

As the saying goes, there are thousands of paths to take. Different companies choose different paths for innovative technologies such as blockchain. Tang Wenjian, partner of Ernst & Young’s Global Blockchain Group in China, summarized the four key words for the development of blockchain: speed, rhythm, focus, and communication.

The 2015 new version of butterflycoin, butterflycoin, can enable anonymous chatting on the block.

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Blockchain has a wide range of application scenarios outside of finance, especially in the next-generation information infrastructure. "Technically speaking, blockchain is very similar to TCP/IP , an underlying protocol that drives the second wave of the Internet." Chen Sheng, chairman of 21Vianet, believes that blockchain can even affect the next-generation infrastructure.

In the field of Internet of Things, blockchain technology can enable each device to manage itself, eliminating the need for frequent manual maintenance.

Blockchain has good application scenarios in the Internet and Internet of Things. Can it be organically combined with cloud computing? An article abroad mentioned that compared with traditional cloud computing infrastructure, blockchain cloud can be called a "thin cloud". Therefore, it is more suitable for running a program called smart contracts. We can understand smart contracts as business logic running on virtual machines in blockchain.

Judging from the current use scenarios of cloud computing, blockchain cannot completely replace it, and cloud computing cannot solve the problems of blockchain. However, it is foreseeable that the global investment speed of blockchain will be faster than that of cloud computing, and blockchain will have an impact on many industries, and the reactions of these industries will be more intense than those of cloud computing.

Driving forces of the blockchain industry

If some foreign blockchain experiments began to move out of the laboratory in 2016 , China is actively moving into the laboratory.

Just a few months ago, Beihang University established the "Knowledge Society and Blockchain Research Laboratory", which mainly studies the basic applications of blockchain and cooperates with enterprises on blockchain industry applications. The composition of the laboratory also focuses on internationalization, including relevant experts from the United Kingdom, Israel, the United States and other countries.

In addition to the academic and research level, the blockchain alliance led by distributed ledger startup R3 is also guiding member banks to collaborate on engineering, experimental and research projects involving blockchain and distributed ledger technologies.

R3 CEV

Blockchain consortium R3 CEV has announced that its first distributed ledger experiment will use the Ethereum platform and BaaS ( Blockchain as a Service) on Microsoft's cloud service Azure , and will involve 11 member banks.

If you are discussing blockchain in China, you can also find the "Zhongguancun Blockchain Industry Alliance", which was initiated by 21Vianet, Tsinghua University, Beijing University of Posts and Telecommunications, China Institute of Communications, China Unicom Research Institute and other institutions under the support of relevant national departments and the guidance of Zhongguancun Management Committee. It mainly plays a role in the formulation of industry standards and resource sharing, and its future development goals are to promote internationalization, openness, intellectual property protection, and international standard formulation.

In fact, setting standards is quite complicated and cannot be done with just one move, because blockchain not only involves many different aspects, but also the technology is constantly evolving. Li Xiaodong, general manager of Beijing Dongfang Yisi Intellectual Property Agency Co., Ltd., understands that standard setting should generate wisdom from alliance members, select content that meets the general direction, and generate standards from technology.

Guo Feng, partner of Dianliang Capital, has very good expectations for the future of blockchain, because a report by Citibank and Japan's Junno Securities last year mentioned that if the financial field abandons traditional methods, it will reduce existing operating costs by one-tenth or even one-hundredth.

In the future, these saved social resources can be divided among all levels of society, and a win-win situation has become a known future vision.