Blockchain is a technology that enables secure and transparent transactions without the need for a central authority or intermediary. It can be used for various purposes, such as digital identity, supply chain management, voting, and more. In this article, you will learn how you can use blockchain to bypass intermediaries and enjoy some of the benefits of this innovative solution.
Intermediaries are third parties that facilitate or verify transactions between two or more parties, and can include banks, brokers, escrow agents, regulators, or any other entity that provides a service or a guarantee. However, intermediaries can also present some difficulties, such as charging high fees or commissions, creating delays in the transaction process, being vulnerable to fraud or hacking, and having access to sensitive data that could be misused.
First comment on the intro paragraph. The blockchain is by design an INTERMEDIARY. It is an automated one, it is an immutable one, indeed, but it is ONE. How is blockchain any different than what is exposed here? 'Charging High Fees' : aren't public blockhains very expensive per transactions? 'Creating delays' : Isn't the 60' for full transaction guaranty in Bitcoin kind of creating delay in the process? Do I need to go on with the other examples? An Intermediaty IS an intermediaty. They all can either fall in these pits or avoid them. Before, to be an intermediary required many capabilities, technological, regulatory, partnerships, ... Now, "anybody" can download a blockchain and operate an INTERMEDIARY.
The biggest problem is the human element in the described intermediaries. Humans have emotions and can change over time. Code does not.
Blockchain is a distributed ledger that records transactions in a chronological and immutable manner. This is because the validity and integrity of each transaction is verified by a network of nodes using cryptography and consensus mechanisms. As a result, blockchain does not require intermediaries to confirm or execute transactions, allowing parties to directly interact with each other and trust the system. The advantages of blockchain over intermediaries include reduced costs and increased efficiency due to the elimination of intermediaries' fees and delays, enhanced security and transparency through making transactions immutable and auditable, as well as empowering users by giving them more control and ownership over their data and assets.
Blockchain can be used to bypass intermediaries by – Enabling peer-to-peer transactions that are secure and verifiable without the need for a central authority Utilising smart contracts to automatically execute agreements based on predefined rules, reducing reliance on intermediaries for enforcement Blockchain eliminates intermediaries by – Providing a decentralised ledger that ensures transparency and trust among parties Reducing transaction costs and time delays associated with traditional intermediation Enhancing security and reducing fraud, as the blockchain is immutable and tamper-evident
This is 'partially' correct. What is described here are "public" blockchains. Private blockchains are way more interesting, powerful and don't drag the usual drawbacks like power-consumption and illegal activities. 'blockchain does not require intermediaries to confirm or execute transactions,' That is incorrect. It is the blockchain that does this. The blockchain IS an intermediary by design. The rest is partially true or false depending. Any Intermediary can have reduced costs, or increased efficiency. It depends on the requirements of the service and the technology used. Too generic of a remark.
Consider a supply chain management system. Traditionally, it involves multiple intermediaries like manufacturers, distributors, and retailers. With blockchain, each step, from production to delivery, is recorded on an immutable ledger. Smart contracts automate payment releases when predefined conditions (like delivery confirmation) are met, reducing reliance on financial intermediaries. This transparency ensures authenticity, reduces delays, and cuts costs, offering a streamlined and efficient supply chain process. Additionally, customers can trace the journey of products, enhancing trust and quality assurance. Blockchain transforms the industry, making it more efficient, secure, and customer-centric.
Blockchain use cases can create value for users and society by bypassing intermediaries. For example, decentralized finance (DeFi) is a movement that uses blockchain to provide peer-to-peer lending, borrowing, trading, investing, and more without banks or brokers. Smart contracts are self-executing agreements encoded on the blockchain and triggered by predefined conditions, allowing transactions to be automated and enforced without lawyers or arbitrators. Additionally, non-fungible tokens (NFTs) are unique and scarce digital assets representing art, music, and collectibles that use blockchain to verify authenticity and ownership, allowing creators and buyers to exchange them without platforms or galleries.
I love the "DEFI" example. "There is no intermediary, there is a 'smart contract' between Alice and Bob." Fair enough. How is it fundamentally different than "there is a (real) contract between City Bank and Charlie" ? In the latter case, Charlie and City Bank have ways to enforce their rights if something goes wrong. In the former... none. "NFTs (...) allowing creators and buyers to exchange them without platforms or galleries." Isn't Ethereum very much like a marketplace or a gallery exposis and trading items between (known) customers?
One notable blockchain use case is in the art industry. Artists can tokenize their creations as NFTs, ensuring uniqueness and ownership authenticity. Buyers, using cryptocurrencies, can directly purchase these NFTs without galleries or auction houses, empowering artists economically. Smart contracts automate royalty payments, ensuring artists receive a portion of resales automatically, eliminating intermediaries. This decentralized approach revolutionizes art commerce, benefiting both creators and collectors.
If you're interested in using blockchain to bypass intermediaries and explore its potential, you'll need some basic tools and knowledge. To get started, you should learn the fundamentals of blockchain, such as its workings, benefits, and challenges. You should also get a wallet to store and manage your blockchain-based assets, such as cryptocurrencies or NFTs. There are different types of wallets available, so choose one that suits your needs and preferences. Additionally, joining a community that shares your interest in blockchain is beneficial; online forums, social media groups, and events are great resources for learning from others, asking questions, and discovering new opportunities and use cases.
Yes, please, get educated in blockchains and digital assets. I have an excellent course that I provide to some major Engineering and Business schools like Ecole Polytechnique or HEC in France, or Columbia University of New York, that I can provide in 1h, 2h, 4h or 7h, depending on the depth required.
Blockchain is a technology that is constantly evolving and expanding, and it has the potential to revolutionize various industries and sectors. It can enable more inclusive and participatory governance models, such as decentralized autonomous organizations (DAOs) and e-voting systems that are secure and transparent. Additionally, blockchain can foster more sustainable and ethical practices, such as carbon credits that incentivize environmental actions or supply chain tracking that verifies the origin and quality of products. Furthermore, blockchain can unleash more creativity and innovation, such as decentralized applications (DApps) that offer new functionalities and services, or metaverses that create immersive and interactive digital worlds. Are you ready to explore the blockchain revolution? With it, you can bypass intermediaries to enjoy more freedom, efficiency, and security. It can also open up new horizons of possibilities for you and society.
Again, this part has solely the view of Public Blockchains, that are the most "advertized" ones, but not the ones that will be used for massive Private services. They showed the way, and will leave the floor, except for some "die hard" users that still believe they can make a fortune out of thin air. In public blockchain, every dollar or euro that's been "won" by someone has been "lost" by someone else. There is no value nor money creation, beside the speculative cupidity of Humans. No news here.
I think it is clearly an article that shows that the topic is not mastered. Should I read such material, I would tag the source as "non competent in that domain". Unfortunately, there are so many "writers" and so few "experts" that these articles are legions. Let alone when stupid GenAI comes in... This article could have been generated by GenAI. It is bad enough to...