Other Side of Blockchain: How Is the Technology Used Today?

blockchain technology

Today when we hear the word “blockchain” we think about Bitcoin, Ethereum and other cryptocurrencies. The distributed ledger technology as it exists now first appeared in 2009 together with the first cryptocurrency. Bitcoin, as well as the vast majority of digital currencies are based on blockchain. Probably the only exception is the project and the coin called IOTA that is based on Tangle technology and does not include blockchain. Anyway, it soon became clear that cryptocurrencies are just one possible way to apply the distributed ledger technology. Blockchain is actually a new and advanced way to store and exchange information, and if we stick to such a broad definition it will become clear how big is the potential of these technology.

Contents:
(please, click the topic to scroll down to it)

  1. What is blockchain technology?
  2. Blockchain and digital currencies
  3. Where is blockchain being applied and what are its prospects?
  4. Conclusion

1. What is blockchain technology?

To put it simply, blockchain is a kind of database, a way of its management. In fact, blockchain comes down to electronic recording of particular information;storage and amendment of this information must be coordinated between independent parties. The method of information storage with the help of blockchain guarantees impossibility of spontaneous information amendments by a user without other users’ concord. Blockchain resembles torrent, both technologies are based on peer to peer principle,where information exchange is carried out directly between equal participants.Every information record is a block. Blocks constitute a chain; so, every other block contains part of information from the previous one. All information of this distributed database stores on  computers of every net user.

2. Blockchain and digital currencies

Nearly all digital currencies are based on the blockchain technology. Cryptocurrency actually exists as a recorded information about transactions just like the real fiat money that we transfer between bank accounts. Digital currencies record, store and change their information using a distributed ledger technology. Many coins are based on the same blockchain. For example such currencies as Namecoin, Litecoin, Dogecoin, etc. are based on bitcoin blockchain. Ethereum blockchain was used to deploy more than 500 other cryptocurrencies, including such popular coins as  Binance Coin and OmniseGo. Some leaders of the cryptocurrency market also used to be based on Ethereum blockchain but later developed or at least started developing their own distributed ledger. These are, for instance, EOS – top-5th digital coin by market capitalization, and TRON. However many cryptocurrencies were not satisfied with what bitcoin and Ethereum could offer and designed their own blockchain. These are Ripple, Zcash, NEO, Dash, Monero, Cardano and others.

So, how blockchain is implemented in cryptocurrencies? A block is a special structure where the information about transactions is recorded. Each block contains the information related to the previous one, so they form a single chain where no one can edit the information on their own discretion. The whole information about what has happened in a decentralized database is recorded into the blocks. Each block includes a header and a list of transactions. Blocks are formed by miners that carry out calculations necessary to find hash. The main function of the distributed ledger is that it ensures cryptographically secured and decentralized storage of the information about transactions.

3. Where is blockchain being applied and what are its prospects?

Blockchain technology is quite cross-functional, because it provides us with the new method of information storage and exchange. In all areas where it is applied, blockchain functions as a universal database that almost cannot be hacked or amended without sanction. However, anyone who has the right can get access to the information. A great interest to blockchain comes from the finance sector.  Traditional banks and fintech startups pay their attention to distributed solutions that blockchain suggests.

Governments treat cryptocurrencies rather negative, but at the same time they realize blockchain potential. Some countries, like Sweden or Arab Emirates, plan switch their register of properties to blockchain.  Estonia develops mechanisms for blockchain-voting at shareholders meetings. Besides,there is e-Residency platform in the country — electronic identification system based on blockchain.

The world’s largest humanitarian organization called World Food Programme uses blockchain to provide refugees with food via existing shops and retail chains instead of directly distributing food or money to buy some.   

Smart contract technology that is realized on Ethereum blockchain is not restricted only to cryptocurrency transactions processing. It is a kind of new method of contractual arrangements where there is no need for lawyers,banks or other mediators.

Today blockchain is already being used for creating distributed cloud storages, where users’ data (including personal data) will be protected by cryptographic means.

4. Conclusion

Anyway, blockchain is definitely an important technology that is likely to increase its impact in the near future. World Economic Forum describes blockchain as a fundamentally new form of computer architecture that brings the opportunities that could be compared to those brought by the development of the Internet in 1990s and smartphones in 2000s. The potential of distributed ledger is obvious for businesses and even state authorities and many of them started applying the technology in a number of areas.

Blockchain appeared 10 years ago, which is actually quite a long time given the speed of scientific and technical progress. However, we can state that the real potential of the technology is being discovered today. Blockchain is actually a new useful way of storing and transferring information, while in the modern society it is perhaps the most important asset.

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South Korea Launches Remittance App Using Ripple’s Blockchain Technology For The First Time

One of the biggest South Korean crypto exchanges, Coinone, has presented a new web service and a remittance app called Cross. It uses RippleNet for providing faster and cheaper payment services for citizens of the Kingdom of Thailand and the Republic of the Philippines.

To release this payment service, Coinone Transfer, a subsidiary of Coinone, utilized Ripple’s blockchain technology, as well as Siam Commercial Bank (Thailand) and Cebuana Lhuillier (Philippines).

Ripple emphasized that Cross does “not rely on traditional banking rails,” i.e. comparing to other remittance options, Cross plays in an absolutely different league.

The press-release also stated that South Korean remittance services had been limited due to high fee for overseas transactions. Cross, by contrast, provides a total transaction fee of 1%. Moreover, it offers “bulletproof security” for customers.

We remind you

SWIFT Created A New Payment System To Protect Blockchain and FinTechs Provided By Ripple, JP Morgan, and Transferwise

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Samsung Galaxy 10 Will Not Have an Inbuilt Crypto Wallet

After the South Korean electronic devices giant Samsung filed three patent applications for crypto and blockchain-related software, the rumours started that the company is planning to incorporate a cold crypto wallet in one of its main upcoming releases – Samsung Galaxy 10.

Samsung’s cryptocurrency service will essentially have two parts. A cold wallet for saving cryptocurrency and a crypto wallet for transfers,” claimed a Samsung news site.

Nevertheless, the official representatives of the company shared in a private talk with the Cointelegraph that the following news were no more than speculation and gossip. Thus, we can now be sure: although, Samsung is actually researching and probably planning to incorporate crypto and blockchain into its products, there will be no crypto wallet in the phone Galaxy 10.

We remind you:

Samsung Created a Blockchain Platform for Banks

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Facebook Is Once Again Looking for Blockchain Specialists

Being a social media giant, Facebook could not turn a blind eye to blockchain. It actually launched a whole department devoted to the research of this technology and was looking for a manager for this department some time ago.

However, none of the representatives of Facebook have revealed any detail as to what they are planning to do with blockchain, which caused a wave of rumors starting from the assumption that Facebook is going to release its own cryptocurrency to the one claiming that Facebook was working on a blockchain network, planning to outrun Ethereum.

The truth is still unclear, but the fact is: Facebook is definitely working on something. It has listed 5 vacancies for blockchain developers on its official site. Considering the fact that it is Facebook and also the rate of salaries for blockchain specialists, there surely will be a huge fight for these 5 jobs. We remind you:

Blockchain Specialists Receive the Highest Salary Among Software Developers

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SWIFT Created A New Payment System To Protect Blockchain and FinTechs Provided By Ripple, JP Morgan, and Transferwise

SWIFT has announced in its latest press-release that it decided to launch a new payment service – Global Payment Initiative (GPI), which is still in pilot version. The system is aimed at combating threats that bring harm to blockchain and other fintech solutions of such institutions like Ripple, JP Morgan, and Transferwise.

The main target of the pilot is “to build the foundation of a new integrated and interactive service that will significantly improve efficiencies in the payments process and which will ultimately be made available to all 10,000 banks across the SWIFT network.”

The GPI tests were conducted in October to try cross-border payments with banks in Thailand, China, Australia, and Singapore. The trial showed that using GPI-system payments could be carried out almost instantly.

According to SWIFT, the pilot GPI system starts working in the first half of 2019. It will cooperate with 15 financial institutions, including Bank of China, JP Morgan, CitiGroup and others. The service provides full transparency to payment beneficiaries and originators.

We remind you

What Is Happening Between Swift and Ripple and Why Does Ethereum Suffer From It?

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What is Common Between Ripple Technology and XRP Token?

In this article, we will focus on the project, which has recently taken the second place in the cryptocurrency rating. Today we will talk about how XRP token is connected with the famous Ripple technology, which should make a revolution in banking sector in the future.

1. Briefly about Ripple cryptocurrency

The Ripple project is in no way just another copy or an improved Bitcoin`s version. The only thing that unites these two coins is the blockchain technology. Let’s clearly define what the Ripple is:

  • There is a system of gateways at the heart of the Ripple network, the performance of which is provided by hundreds of servers. Ripple works through distributed registry technology, but its architecture is completely different from the standard blockchain. The project does not have decentralization, since only those servers that have been approved by the company, are involved in transaction validation.
  • The main task of the project is to ensure a free and fast exchange of assets with minimum fees (0.00001 XRP).
  • The target audience of the project is banking institutions, which can save about $3 for each transaction with the help of Ripple technology. If we consider, that large banks spend millions of transfers per year, this leads to significant savings.

2. What positions does Ripple take now?

In mid-November 2018, the entire cryptocurrency market collapsed sharply. Many coins lost 40-50% of their value in a week. In this situation, XRP token showed relative stability and fell by about 20%. At the same time, Ethereum fell substantially in price. Because of this disbalance, Ripple took the second place in the cryptocurrency rating. For the moment of writing this article, the project`s capitalization is equal to 12.5 billion dollars. The gap from ETH is almost 3 billion dollars.

3. Future forecasts

Let’s talk briefly about prospects for this project, and what XRP hodlers can expect. For a start, it is worth noting that Ripple is a legal entity officially registered in the United States. This is an undeniable advantage for investors. But it should be understood that the Ripple technology used by banks has nothing to do with XRP token. The fact is, that Ripple has three different products (xCurrent, xRapid and xVia). Banking institutions are interested in the first one, and XRP token is directly related to the second one. Therefore, there is no direct correlation between XRP token rate growth and the introduction of Ripple technology into the banking sector.

Some experts say that banks can start using xRapid technology. If this happens, then XRP token will be really useful and needed. But if you go a little deeper into this question, it becomes clear that such a scenario is highly unlikely. In this case, banks will have to buy an intermediate XRP token additionally, which will increase the cost of transactions. Therefore, the vast majority of analysts believe that banks will not take such a step.

But there are still some reasons for token`s price increase:

  • The possibility that banks will shift to xRapid technology. It is unlikely, but still possible.
  • Increasing of customer base.
  • Regular burning of tokens (deflation).
  • Expanded applications (using Ripple technology, you can exchange absolutely any assets).
  • A general trend change on the market, may lead to another sharp rise in the token price.

4. Conclusion

The Ripple Company is a legal entity registered in the United States. It actively cooperates with the leading banks in America, but this does not concern the XRP token.

The coin definitely has a future, so it is better to keep it in cryptocurrency portfolio in a small amount (no more than 5% – 10%). Recently, XRP cryptocurrency firmly entrenched on second place in the global ranking CoinMarketCap.

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Bitcoin’s Price in 2019: Forecasts and Opinion of Experts

Attention of many people around the world is focused on the Bitcoin price. No one can say for sure, where it will go next year, or moreover in a few years. Some people believe, that the cryptocurrency industry has already reached its maximum, and all that we are waiting is a continuous decline of value. But there are experts who are sure that the maximum marks of BTC is only beginning and we are expecting for the new heights in the future. Well, let’s try to look into the matter and analyze the words of leading financial experts of the world.

1. Analysis of the current situation

As we all remember, the capitalization of the cryptocurrency market reached its historic maximum 831 billion dollars in January 2018. After this, a deep and prolonged correction has started, which partially continues until now. At the time of writing, the market capitalization is 107 billion dollars, the Bitcoin price has fallen in 6 times, and many coins have become cheaper in 10-20 times.

Source: CoinMarketCap

At first glance, everything seems to be bad and prospects are rather vague. But what if we tell you that everything is absolutely opposite and now it is the best time to invest in cryptocurrency? We are ready to back up our words with concrete facts about which very few people talk. 

  • Continuous growth of network`s hashrate. Despite the fact that the price of first cryptocurrency shows negative profitability throughout 2018, the total computing power of Bitcoin network is constantly growing. It means that miners are increasing their production capacity. And it is not about small or medium farms, since their share is negligible on the general background.

Source: https://bitinfocharts.com/

After analyzing this graph, it appears that big miners continue to invest hundreds of millions dollars in equipment. This means that major players continue to believe in further development of the industry, and therefore in future growth of the BTC rate.

  • Infrastructure development. In 2018, investor`s interest in cryptocurrency faded a little, but this did not affect infrastructure development. Every day, the number of places where you can pay with cryptocurrency is growing (paying taxes in the USA, real estate, online shopping, transport tickets, physical points of sale and more). It is a very good trend, because the more places you can pay with BTC, the more people will be involved in the digital economy.
  • The acceptance of cryptocurrency at the government level. In 2018, for the first time in 10 years of Bitcoin’s existence, they started talking about it at the international level. If earlier none of the world leaders paid enough attention to this topic, then this year at the G20 summit this issue was put on the agenda. World leaders agreed that it would be pointless to forbid cryptocurrencies and no one would do that. On the contrary, there was decided to develop an international legislative framework.
  • It’s still possible to become a “pioneer”. If you go to the website bitinfocharts.com and take a look how many Bitcoin wallets are registered currently, it is possible to see the number that does not exceed 23 million. Taking into account that more than 15 million of them are wallets, which balance does not exceed $100. The population of our planet now is about 7.6 billion people. Let’s take 40% of insolvent people (children, pensioners, people who live in a third world, etc.) – it comes out near 4.5 billion people. After comparing these numbers, it appears that there are still very few people who are really involved in the cryptocurrency industry. That means, a global large-scale acceptance of technology does not exist yet. This gives us a chance to become pioneers. After cryptocurrency becomes a commonplace for any person (like, for example, a credit card in our days), we will reap the benefits. Most likely you will hear such expression in future: “Why didn’t I buy Bitcoin in 2018?”.

2. Expert forecasts for 2019-2020

Now let’s see what famous experts say about the near future of Bitcoin, namely about its price.

Mike Novogratz, CEO of Galaxy Digital, believes that the start of Bakkt and Fidelity Digital Assets platforms will affect on entry of new investors into the cryptocurrency market. According to Mike`s opinion, now the most important point of resistance is the mark of $ 3,880. If we overcome it, then the rate may reach $ 9,000 till the new year. The next important mark is $10,000. After overcoming it, the price of BTC 2019 will go up sharply. Novogratz has no doubt that the next year rate of Bitcoin will overcome its historical maximum of 20,000 dollars.

Tom Lee, is one of the leading analysts of Wall Street. Previously, he stated that until the end of 2018, the rate of Bitcoin will overcome the mark of 25 thousand dollars. But after a few months, namely in July 2018, he slightly revised his views and named the new price of Bitcoin 2019 – 22 thousand dollars.

The forecast of John Mcafee is the most bravest of all existing on the market. He believed that by December 2020, the price of one bitcoin will be $1,000,000. Moreover, John is confident in his forecast like no one other. In his view, in the upcoming future, Bitcoin will replace dollar, which will cause huge demand.

3. Conclusion

After analyzing the current situation and the words of industry experts, we can conclude that Bitcoin and cryptocurrency in particular have a great future. Now we are only at the beginning and in the next decade, cryptocurrency will change our life. It should be noted that this article is not a call for investing in cryptocurrency. These are just our subjective thoughts about the future development of the industry. Remember, any investment entails a certain risks.

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