Tag Archive for blockchain

Blockchain! What is it Good For?

Blockchain

This blog post was also published on Amalgam Insights.

Blockchain is one of those up and coming technologies that is constantly being talked about by vendors and pundits. Many of the largest IT companies – IBM, Microsoft, and Oracle to name few – plus an industry group or two are heavily promoting blockchain. Clearly, there is intense interest, much of it fueled by exotic sounding cryptocurrencies such as Bitcoin and Ethereum. The big question I get asked – and analysts are supposed to be able to answer the big questions – is “What can I use blockchain for?”

To begin with, the best applications of blockchain are those that require an authenticated source. Blockchain (sort of) provides an immutable proof of the a virtual or material object’s authenticity. Using cryptography to generate unbreakable codes (for the moment) that take a lot of resources to generate insures that hacking the authenticity of a blockchain is not feasible. This is what made it attractive as a currency. Blockchain makes it hard to create a forgery of the “coin” while supporting changes of ownership.

Another indicator that blockchain may be useful for an application is when lack of a central authority to manage transactions is desirable or unattainable. Blockchain allows for participants to interact as peers without a clearinghouse to moderate the transactions. Credit cards, for example, are transactions between consumers who want to buy something and merchants who want to sell them. Visa, American Express, Discover, and Mastercard enable these transactions by clearing them between the banks of the buyer and seller. Without the clearinghouse, credit cards wouldn’t work. In the case of Bitcoin, changes in ownership are recorded in the blockchain that underlies the currency and distributed to all parties participating in Bitcoin.

I’m oversimplifying the complexity of blockchain, of course. That doesn’t change the fact that the best blockchain applications will be those that require authentication and lack a central authority to grant it. Some examples of these type of applications are:

  • Material supply chains. Blockchain holds promise as a way to inhibit counterfeit parts from entering the supply chain. The blocks in the chain represent parts that can be transferred from owner to owner. This would produce a history of where the part originated and where it has been as it moved through the supply chain. A hash can identify the part and the ledger agreed to by all participants in the supply chain since they all have a copy of it.
  • Transportation. Similar to material supply chains, blockchain shows potential to help track shipments along a series of routes, even while the shipments change hands between different carriers. This can keep shipments from being diverted or stolen.
  • Smart contracts. Blockchains can represent a contract, it’s amendments, and agreement to the final document. Unlike many electronic contracts, all parties would have a complete copy of the entire history of the agreements made within the contract and it will be hard to dispute the “signatures” later. The contract can be agreed to without a third party, such as Docusign, or the potential for forged signatures.
  • Professional credentials. It is not news that job seekers will sometimes inflate or falsify their academic credentials. In some cases, job seekers go so far as to claim doctorates that they never earned. Now, imagine how easy it might be to claim technical credentials that are conferred by training organizations that may not exist forever. There are also plenty of professions such as medical, dental, and law, where a constant stream of new learning is required to maintain licensing. In all of these cases, blockchain could be used to create a trustworthy method of verifying credentials that can easily be shared with anyone to prove their authenticity.
  • Personal identification. Almost everyone has had their email system hacked at some point or another. This is an example of someone stealing an aspect of someone’s electronic identity. The same is true for credit card numbers, social security numbers, and other forms of personally identifying information. If personal identification was actually a blockchain, this would be much more difficult since thieves would have to steal something that is never shared online. Blockchain hold the promise of online authentication that is harder to hack then even two-factor authentication.

Some of these are purely speculative though plausible. Others, especially the professional credentials, transportation, and material supply chains applications are already under development.

Like so much interesting technologies, the hype is a bit early and probably overstates the technology. We shouldn’t let the hype undermine blockchain’s potential nor dissuade developers from exploring its usefulness. There are so many instances where authentication of transactions is hard but necessary and a central authority doesn’t exist or is undesirable. These are just the early emerging applications – the low hanging fruit – and it is hard to predict the good ideas developers will come up with for blockchain.

Technical Books I’m Reading

A Shelf of Technical Books

I try to keep current on technology. As weird as it may seem, to be an IT industry analyst, you don’t have to know much about technology. You can understand the market without knowing the technology that drives it. It’s limiting but possible.

To really understand IT customers – truly grok them – you need to live a bit in their world. It is my belief that understanding technology provides insights into the market.

More importantly, I like information technology, programming, and and all things geeky. It was my profession for many years before moving to the business side and my heart is still there. So, it is for myself as much as my clients and audience that I continue to go deep in technology.

I have also recently discovered Humble Bundle. They make collections of e-books, comics, and games available for a very low price and donate much of the proceeds to various charities. You can donate as little as US$1.00 and get four or five books. Check them out. They’re awesome.

Subsequently, I have been feasting on technical books on a variety of subjects. Besides my usual array of technology sites and news, here’s what I have been reading.

  • Head First Data Analysis, Michael Milton, O’Reilly – Semi-technical, accessible, introduction to the concepts of data science.
  • Doing Data Science, Cathy O’Neil and Rachel Schutt, O’Reilly – A more in-depth exploration of the process of data science.
  • Think Bayes, Allen B. Downey, O’Reilly – Tutorial on Bayesian statistics.
  • Think Stats, Allen B. Downey, O’Reilly – Tutorial on classical statistics.
  • Mastering Docker 2nd edition, Russ McKendrick and Scott Gallagher, Packt – Both introductory and advanced Docker concepts. Good starter for the budding container enthusiast.
  • Getting Started with Kubernetes, Jonathan Baier, Packt – Introduction and tutorial for Kubernetes.
  • Blockchain Basics: A Non-Technical Introduction in 25 Steps, Daniel Drescher, Packt – ntroduction to Blockchain. The non-traditional style was hard for me to get used to.
  • Mastering Blockchain, Imran Bashir, Packt – More traditional and in-depth introduction to Blockchain and major implementations of it such as Bitcoin and Ethereum. I’m reading this now.

I’ve got a lot of books coming up – I bought 41 of them for something like US$35 – including a set of Java books, and more on Cloud, Data Science, and Blockchain/Bitcoin. There’s a book on OpenStack that looks interesting. R in a Nutshell, Thoughtful Machine Learning with Python, and Java 8 Lambdas are all possibilities too. That assumes that Humble Bundle doesn’t wave something interesting in my face. I almost bought the last Python bundle but resisted. Oh, and I have a ton of Linux books waiting in the wings too.

Of course, the group above tracks my current interests. I’ve been writing code in Java since the 1990s when Java v1.0 was mostly a associated with adding applets to websites. Cloud, Containers, DevOps, Blockchain, and Data Science are top of mind for me professionally and the IT community as a whole. These books talk to the everyday work of developers which is what interests me the most.

So, I’m more than happy to settle in with a good book so long as it’s techy.