The Enterprise Blockchain Gap A number of large corporations, including Microsoft, IBM, Oracle, and SAP, have started to take notice of, and invest in, blockchain technology. Enterprise customers are interested in the blockchain because it can help reduce fraud, increase transparency, and provide secure record keeping. Blockchain technology has started showing up in such diverse fields as cybersecurity, insurance, and supply chain management. Less technically savvy corporations are starting to dip their toes in the water, but there’s a huge gap between the desire to invest in blockahin technology and developers with the skills to implement it.
Bitcoin’s ledger uses a model called UTXO, which stands for Unspent Transaction Output. What that means is that every transaction on the Bitcoin blockchain is a reference to one that came before, and anything unspent from the previous transaction (not sent to a new recipient) is sent back to the sender as change. The Bitcoin blockchain doesn’t track the balance of an account, it just tracks transactions, and builds new transactions from old ones.
There are a lot of cryptocurrency traders out there that think they know the formula to pick the next coin to get 10x their return. And maybe they’re right…or maybe it’s just luck. If a lot of people are making a lot of predictions, eventually some will look like geniuses. I built Rando Crypto, the worlds least advanced cryptocurrency trading bot. It’s completely random. Some of the bots are doing quite well, up over 14% in 24 hours.
Ethereum introduced the world to the idea of Smart Contracts, which are blocks of code that are executed on the blockchain in a distributed manner. Smart Contracts are run on every Ethereum node and the results verified by the network, which makes it possible to execute code in a distributed and trustless manner. Anyone can join the Ethereum network and run a node, and participate in the validation of the Smart Contracts that get executed.
NEM is one of the oldest cryptocurrencies, started back in 2014, and one of the most valuable, with a market cap over $15 billion, but it’s also one of the least talked about. That may stem from its origins in Japan, but over the last few years it has expanded its reach to Asia, Europe, and beyond by forming partnerships with major corporations around the world to use the private version of the NEM blockchain.
Cryptocurrency Incentives In most early cryptocurrencies like Bitcoin, miners secure the network by verifying transactions and adding new blocks to the blockchain. The miners are rewarded with newly created bitcoins, which provides them the incentive to ensure they keep working. It was an elegant solution to the problem of securing a decentralized network. But directing all financial incentives to the miners leaves nothing to incentivize the community, the group that is most needed to grow adoption of the cryptocurrency.
The Limits of Ethereum Smart Contracts Smart contracts, introduced to the world by Ethereum, allow for decentralized applications (dApps) that work on a blockchain. What that means is that everyone can read the code, know when it is being executed, and to inspect the results. You don’t have to trust the entity running the code because, in essence, the code is run everywhere, on every node in the blockchain, at the same time.
Stellar was born in 2014 as an offshoot of Ripple because Jed McCaleb, the co-founder, had philosophical differences with the rest of the Ripple board. While Ripple is focused on providing solutions to banks, Stellar aims to help facilitate payments between people. While they work in a similar fashion, Stellar is sort of like a “bottom-up” approach compard to Ripple’s “top-down”. Stellar Lumens are the currency used by the Stellar network, and when the network was started 100 billion Lumens (XLM) were created.
RaiBlocks and Centralized Consensus RaiBlocks may be the most fundamental change to cryptocurrencies since Bitcoin introduced the blockchain, and a lot of people are taking notice. Its market capitalization has grown from $26 million to over $2 billion in less than a month and it hasn’t even been listed on any of the major cryptocurrency exchanges yet. With growing interest comes growing skepticism. Instant transactions and no fees sounds too good to be true.