Cloud innovation was responsible for creating a near-trillion dollar ecosystem. But that was just the first step. Blockchain is the logical next iteration of computing.
Cloud was the first move away from centralization. Companies needed to store files and access processing power for applications with ample network bandwidth to accommodate day-long use. However, server rooms required maintenance, constant security, proper provisioning and regular updates. By moving servers offsite (or into the cloud), companies could expand their operations beyond the shackles of hardware.
Today, companies can spin up offices virtually anywhere and even hire remote workers with ease. Computers and smartphones are simply bridges to more processing power concentrated elsewhere.
Cloud decentralized the workforce
Now, Blockchain is introducing the second iteration of computation structure. Through a distributed ledger system, Blockchain has created networks of computations that are secure, immutable and democratic. This could lead to un-hackable programs and web services, transparent networks and stronger system reliability.
Blockchain decentralizes computation
Blockchains use miners to solve mathematical problems and provide consensus. Mining participants lease their computing power to the Blockchain network in exchange for cryptocurrency rewards. Collectively, they build the network and verify the creation of additional “blocks.” Groups of miners make up a system of nodes in the network that store and process data. Miners have computing pools around the world that allocate their processing power to:
- Keep a full-copy of the Blockchain
- Verify and process transactions
- Run applications/smart contracts
Ethereum, one of the most popular Blockchain platforms, allows developers to access the Blockchain through the Ethereum Virtual Machine (EVM). The EVM provides developers tools to build decentralized applications or Dapps. These applications use the Blockchain to host their backend processes.
Instead of an application operating on a single server. Dapps are split into fragments, sort of like a torrent, and run concurrently. Several computers run bits and pieces of a program with numerous redundancies. These programs make up a command-based ledger that is constantly verifying code. No single computer owns the entire application backend, so it becomes near impossible to hack or corrupt.
Unlike cloud computing, the decentralized Blockchain doesn’t need to live in a server room. Cloud applications typically do carry redundancy on a handful of nodes, but nothing close to the thousands of nodes working on networks like Ethereum.
The Cloud moved servers off of enterprise campuses and centralized the processing power elsewhere. Blockchain is slicing up the processing power and scattering it all over the globe.
The potential for Blockchain to harness the computing power of the entire Internet demolishes the fictitious belief that cryptocurrency is without value, a bubble or tech’s latest fad. The truth is, cryptocurrency can act as a smarter and safer bartering system that enhances the delivery of Internet technologies and applications. With Blockchain, we can create a volunteered network , an internet/cloud 2.0 , that enhances cyber security and lends itself to advancements in computing, AI, IoT and record keeping. It’s a multi-trillion dollar solution to issues across all market verticals and we are just scratching the surface.