Financial applications and use cases dominate the blockchain industry and cryptocurrency sphere. When people talk about cryptocurrency, they almost always talk about the “currency” aspect and how it will revolutionize the current global financial system.
We expect this, as Bitcoin was the first successful cryptocurrency, meant to be a digital cash (a currency), as outlined in Satoshi Nakamoto’s whitepaper. Other cryptocurrencies have since followed suit, thus making financial blockchain applications and use-cases a very strong focus in the industry.
Non-Financial Blockchain Applications
Applications of blockchain technology apply to a wide array of use cases other than financial applications such as supply chain management, healthcare and identity management just to name a few.
Touching on this matter, Vitalik Buterin, the co-founder and figurehead of Ethereum recently went on a tweetstorm on the non-financial applications of blockchains.
1. Time for a brief tweetstorm on non-financial applications of blockchains. As blockchain scalability gets better and better, and UX improves and fees drop as a result, this will become a bigger and bigger part of the story.
— Vitalik Non-giver of Ether (@VitalikButerin) December 10, 2018
The twitter thread goes on with 15 tweets by Buterin, followed by a vigorous debate and comments from adamant crypto enthusiasts and Buterin himself.
The thread starts off with Buterin explaining that the various aspects of blockchain is getting better and better including scalability, user experience (UX), and fees. He says these things will have a great impact on the industry.
Buterin then explains an under-appreciated way to view blockchains, stating that:
One under-appreciated way to view blockchains is as an extension of cryptography that does different things. Cryptography allows you to encrypt data, prove data was signed by someone, etc etc…. blockchains OTOH allow you to prove that a piece of data was *not* published.
The above quote presents how blockchains are used for an array of use cases surrounding verification. He stated that by using the cryptographic aspect of blockchain alone, you can check things on-chain to verify the validity of such things.
He provided simple examples of using blockchain technology for cryptographic verification including a university degree verification app, key revocation in self-sovereign identity, and verifying integrity of bids during an auction.
Vitalik on the Future of Blockchains
Following his proclamation of use cases and examples, Buterin touched on the importance of public blockchains and how they will become far more viable:
Public blockchains have a genuine competitive advantage over both centralized servers and consortium chains in credibly signaling neutrality. Right now it seems like benefits like this might not be worth the costs of public chains, but that’s just the public chains of today…
In his next tweet, Buterin explained that soon, proof of stake and sharding will be thousands of times more efficient so putting more and more things on-chain will be acceptable. He used an example of blockchains becoming so efficient he foresees things like receipts of every day purchases being published to blockchains.
Buterin says blockchains will become the simplest tool out there for achieving guarantees of verifiability, non-double-spending, etc.
To end his thread, Buterin proclaimed that the blockchain and cryptocurrency community should take non-financial blockchain applications more seriously as they could pave the way for more important financial implementations of the technology.
Non-financial applications have a leg up over financial ones in one important sense: there is less at stake if they break, so fewer reasons to fear deploying them fairly quickly. So they could be the first applications deployed widely, especially in institutional contexts.
What do you think about the applications and use cases mentioned by Vitalik? Do you agree with him? Let us know in the comment section below.