The Problem With Blockchain That No One’s Talking About
Yes, it’s got massive potential, but it’s missing something critical right now.
PHOTO CREDIT: Getty Images
We are at a unique point in history. There are a number of massive, tectonic, humanity-shifting technical revolutions taking place, all at the same time. Advances in virtual reality, nanotechnology, artificial intelligence, robotics, blockchain, and more, are changing the face of both the present and the future.
Blockchain in particular stands out as one of the least-understood and yet most potentially life-changing industries around. It will likely fundamentally impact the fields of finance, economics, and beyond in ways we don't yet truly grasp. Yet despite the hype, the number of people who regularly use decentralized apps built with blockchain remains staggeringly low. According to DappRadar, even the most popular decentralized app has fewer than 2,500 daily users.
Read that again: fewer than 2,500 daily users. Instagram has near 2.5 million daily users.
The fact is, according to people like Matt Nolan, Founder & CEO of blockchain startup Menlo One, we're squandering the ability of the field to advance if we don't pay attention to something important: making great tools available to developers to build with.
This is in part because the industry hasn't been paying attention to itself. The zeal and heady focus on the possibilities inherent in the technology have pulled focus away from the practical needs of those involved in the creation and maintenance of the system itself.
For example, according to Nolan, the predominant sentiment is that what we need is basically better, cheaper Ethereum with more features -- that we're essentially running a race to get the fastest, cheapest blockchain.
But what he and his team are learning (along with others in the space) is that Ethereum isn't good enough. Or rather, the tools around it are lacking. Developers simply don't have enough of what they need to advance the field.
For example, when Ruby on Rails came out, it dramatically reduced the time and cost of building an app. Ruby is directly responsible for the exponential growth seen in Silicon Valley in the 2000s, and helped usher in the web 2.0 era. By giving developers a basic app skelton instead of starting from scratch, frameworks like Ruby on Rails were game-changers.
According to Nolan, blockchain needs better standardization, templates, and libraries, just as much as it needs better protocols. It's like protocols are recipes, and everyone is focused on collecting endless recipes. But a chef doesn't just need a recipe -- she or he needs the tools to practice the craft: sharp, quality knives; a walk-in fridge where things are stacked and organized; a commercial-grade stove; and more.
Part of the reason this is so vital is that blockchain really could alter our world. According to Abigail Johnson, CEO of investment firm Fidelity, "Blockchain technology isn't just a more efficient way to settle securities. It will fundamentally change market structures, and maybe even the architecture of the Internet itself."
Imagine a world in which you never again had to pay 1.5-3% on a transaction because your customers could transfer money directly--no middle man. Imagine freedom from the possibility of hackers taking over your electric car, or your Nest home security system. Imagine never again worrying about identity theft.
Imagine elections in which votes could be both counted and verified as legitimate.
The truly transformative part of blockchain is that no one owns it. There are no big institutions controlling everything on the ledger. Instead, info is stored across a vast number of nodes (personal computers, for example). That means it can't be compromised. You can't just change or delete a tweet, or skim money off the top if it's stored on the blockchain. The fact that the ledger is both distributed and decentralized means no one can corrupt it (including governments).
But for it to be truly useful to normal, everyday people, developers must be able to build apps using blockchain, and have those apps run fast enough. Startups like Menlo One help with that; its framework includes a wallet specifically engineered for decentralized applications (dApps); a communication tool called TownHall so investors can get accurate info on which blockchain startups to invest in; and a way to save blockchain data on high-performance servers, so dApps can work as fast as their centralized counterparts.
We need the devs to have the right tools, so they can help change the world.
Blockchain is no longer in its infancy; now, it's more like a toddler. With higher-quality tools, communities, and standardization, it could grow up and meet its potential--to serve humanity in uplifting and transformative ways.