It's been around for a while, yet many still struggle with understanding blockchain, and why it's so important. Let alone how to start a tech venture on it, and reap the benefits of an early entrant.
Blockchain Adria, a business and tech conference held in Rovinj, Croatia last week, shed valuable light on business aspects of blockchain, an "open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way"*.
First conference of its kind in the region, it focused on the possibilities of developing a startup on this technology, which allows value transactions to occur digitally, in an uncentralized but reliable way.
First off, speakers said, it's important to understand that blockchain is not bitcoin. Rather, it is a particular kind of technology, a distributed platform that underlies bitcoin and other cryptocurrencies, in the same way that internet underlies email service.
Blockchain opened opportunities on a scale that hadn't existed since the early days of internet, conference speakers said. Its transformation potential is enormous, but far from clear. It is still difficult to predict or even imagine the range of applications and products that developers and companies could build on top of blockchain, lecturers said.
Blockchain seems to have solved a major problem of uncentralized online transactions, in which false or double records could easily be created, which made any such system unreliable, and diverted potential users from it. With digital transactions, a middle instance with authority, usually a bank, government or another entity, was always needed to ensure accuracy and eliminate room for fraud.
Blockchain has solved this by introducing a particular system of keeping a public ledger (a chain of blocks) which all the parties that transact can trust. It is under nobody's control, it's not installed on a central unit and it's resistant to data modification by its very design. As such, it has the potential to eliminate middle instances like banks, and become the foundation for a number of new products and services.
Banks have jumped in as well, and are looking how to use it in their own ecosystem. For now, well known applications of blockchain technology are cryptocurrencies like Bitcoin or Ethereum, but that's only a small portion of a possible future ecosystem that could emerge, built on blockchain, conference participants said.
Early investors are already deep in the cryptocurrencies, exchanges and ICOs, well aware of risks. The area is still unregulated, a lot of experimenting is taking place, and some projects have been vulnerable to theft and misuse. For early investors and experimenters, many things can go wrong. But, potential rewards are expected to be proportionally high.
Dan Dabek, who bought his first Bitcoins years back, while on trip in Mexico, is considered one of the influential figures in the area. He suggested to conference participants to try out one of many cryptocurrency wallets out there, to start learning about it without much risk, and understand the emerging ecosystem better.
Other speakers included Anton Golub, Danny Goh, Terence Tse, Peter Merc, Malisa Pusonja, Tali Rezun, Nikola Jokic, Ivan Bjelajac, Zoran Milosevic, Peter Trcek, Andrej Cvoro, Gregor Kozelj, Rok Babic, Nik Klemenac and Denis Petrovcic.
Cotrugli Business School, the conference host, is making significant steps towards aligning their management programs and curriculum with high-growth tech and innovation areas.
*Harvard Business Review, January 2017.