Theoretically, it doesn’t pay to cheat. Of course, there are still some weaknesses to the theory. For instance, Ghash.io is a pool of Bitcoin miners whose hashrate has come close to achieving 51% of influence. Large mining pools are currently the biggest threat to the blockchain concept because they could potentially centralize the entire system:
“If mining became even more centralized than it is already, Bitcoin would still function, and it might even gain mainstream adoption, but it wouldn’t really be Bitcoin. It would have the name “Bitcoin”, but it would essentially be a very inefficient form of PayPal,” says Greg Slepak, blockchain instructor at Blockchain University.
When engineers hammer down a solution to the 51% attack to keep the system decentralized, blockchain will have a really great shot at going mainstream.
Banks are also exploring blockchain technology to bolster their own services by shifting to distributed databases. Nine of the world’s largest banks are banding together to create a uniform financial ecosystem on the blockchain. This graphic created by Financial Times perfectly explains why finance professionals are crowding into conferences to make sense of this technology. Because of the distributed nature of blockchains, assets that move on a blockchain are far speedier and more economical than traditional, central ledgers.
“It’s hard to see a world where that blockchain technology doesn’t end up changing the way we think about asset ownership,” Exchanges at Goldman Sachs podcast.
If blockchain radically changes our conception of ownership in the future, how long until we teach budding engineers how to build an ecosystem around blockchain technology? It’s virtually impossible for computer science programs to keep adding new technologies to its curriculums. Most would agree that truly understanding and building on the fundamentals of new technologies–like the blockchain–is better than piecing together black boxes. But even the notion of “fundamentals” seem to be expanding far too wide for brick-and-mortar universities. Curriculum-designing committees are constantly facing in the relatively new field:
Although the field of computer science continues to rapidly expand, it is not feasible to proportionately expand the size of the curriculum. As a result, CS2013 seeks to re-evaluate the essential topics in computing to make room for new topics without requiring more total instructional hours than the CS2008 guidelines – ACM & IEEE’s 2013 Joint Task Force
But blockchain technology is a convergence of several different disciplines, including distributed computing, cryptography, consensus algorithms and law…more than 20 years in the making. For the sake of simplicity, let’s focus on cryptography (the science of encryption) as a core CS fundamental that’s essential to understanding blockchain technology. In the Task Force curriculum recommendation:
Cryptography is labeled a “Core-Tier2” course, which means it’s not as essential as “Core-Tier1” courses.
Given the tight space in curriculum, chances of students taking this course as part of their core fundamental curriculum is slim. But Ben Horowitz, cofounder of Andreessen Horowitz, says Bitcoin and blockchain may be the most important computer science breakthrough since packet switching. This is likely because of at least two reasons:
It’s one thing to understand the fundamentals, but truly grasping the concept of blockchain requires hands-on learning. And the only way to really learn is by doing. Elite institutions like MIT and Princeton are riding at the tail of blockchain innovation by offering courses and workshops on the topic. For the rest of the 99% of the population, Blockchain technology is a tight knot we must unravel ourselves. Lively forums are filled with chatter daily for support in autodidactic learning. Technologies like blockchain will outpace traditional, centralized brick-and-mortar education. Instead, students will have to rely on distributed sources of learning online to educate themselves.
Slepak is one such software developer who saw a massive opportunity in blockchain technology when he first saw the infamous Bitcoin whitepaper in 2010. “Since then I’ve simply kept up to date using a computer and an Internet connection. That’s all you need,” he says. He’s now an instructor at Blockchain University and a pioneer of the discipline. “Anyone who wants to be really good at something only gets there by having an internal drive to learn the subject,” he says.
Here’s a list of resources to get your hands dirty:
The traditional notion of ownership pre-dates computer science and the Internet. Blockchain technology, in the form of decentralized or distributed databases, invites a shift in our thinking. No longer do you need the store clerk to verify that you have–in fact–purchased this carton of milk. In a sense, we can bring the familiar notion of physical property to the digital world. There’s finally a way for someone to send a piece of digital property to someone else online–safely. The combination of consensus algorithms and cryptography are a much safer, faster and cheaper way to create a universal truth about the ownership of an asset.
Blockchain experts are still testing its theories–but the potential is worth exploring. Any big disruption warrants fear, inquisition and apprehension.
But, starting with financial institutions, distributed business models could pose a big enough threat to spur competition against the status quo. We’re just on page one of this story. If transferring ownership of assets becomes a distributed business model over the next decade, the new frontier will involve trusting in code instead of trusting in an authority. New technologies are generally built on decades of research rooted in fundamentals. But it’s up to our generation of optimistic, entrepreneurial builders to self-learn and apply innovative concepts to help build our future.
Special thanks to Greg Slepak for reading a draft of this piece and sharing his insights.
Network photo by ioptio.