Blockchain is still in its infancy, but the hype around it makes it feel massive. For most of the world, blockchain technology is synonymous with Bitcoin. But the applications of blockchain are far broader than cryptocurrencies. As blockchain advances, it’s important for developers to understand its scaling issues, trade-offs and appropriate use cases.
According to Pluralsight author Jan-Erik Sandberg, “Blockchain… is already affecting our lives in ways we never could imagine only a few years ago, with everything from smart city implementations, to ensuring trust in medical transactions. Even more important to understand is that blockchain technology is only the first step of building trust between strangers outside of the legal and financial realm.”
This is the core value add of blockchain: the idea that once a transaction is appended to the blockchain, it cannot be altered. It doesn’t solve all issues of trust, but it does make it harder to fudge the numbers especially if it is implemented correctly.
Blockchain use cases today
Industries like financial services, healthcare, media, government, supply chain/logistics, IoT, asset management, and remittance services are natural applications for blockchain.
According to Dan Appleman, Pluralsight author of Building an Enterprise Private Blockchain on Salesforce: “The greatest challenge [developers face] today is figuring out which of those use-cases are real and worthy of your time and attention.”
So, what are some of those use cases?
In supply chain and logistics, blockchain technology will eventually be deployed to track how goods move—where they came from, where they’re going, and all the hands they passed through from origin to destination. The implications for piracy and counterfeiting are huge.
In finance, blockchain could reduce data tampering. Data, once entered on the blockchain, would present auditors with a clear, traceable audit trail, making it immune to corruption from any source.
In government, voting is an obvious application (among others). Once a vote is cast, it would be entered on the blockchain, where it couldn’t be tampered with.
In quality assurance, blockchain may someday assist with identifying the source of defects or contamination.
Be aware of trade-offs
While blockchain presents an ideal solution for certain use cases, it’s not without all important trade-offs. There are three: size, time to enter a transaction on the blockchain, and the time it takes to reach consensus.
Blockchain doesn’t scale particularly well.
Blockchain size can become an issue as records are entered. Bitcoin’s blockchain, for example, at the end of December 2017 was 149 gigabytes in size. As additional transactions are entered on the blockchain, it continues to grow. Even more critical is the time it takes for a miner (who requires a fee to do the work) to enter the transaction. The more you’re willing the pay, the more likely your transaction is to find a willing miner; the less you’re willing to pay, the longer you have to wait for a miner to pick up your transaction.
And then there’s the time to reach consensus. In order for the network to know a transaction occurred, the gossip protocol is applied. This means that one node tells another who tells another who tells another—until all the nodes in the network agree your transaction has occurred. As you can imagine, it takes some time to share your transaction with the whole network.
Finally, there’s a cost associated with blockchain. This cost may be tenable in appropriate use cases, but for poor use cases it is likely a deal-breaker.
Developers must catch up to Blockchain’s explosive emergence
With all the potential applications of blockchain, we’ve seen the demand for content on Pluralsight.com explode. Already it’s one of the top performing topical areas with view time up 10X year-over-year. It outperforms other topics like cloud computing and machine learning.
While there’s enormous enthusiasm for the technology, there are few blockchain developers, and the technology isn’t remotely mature—yet. This represents an opportunity for developers to get ahead of the curve by: First, identifying a viable use-case for blockchain; and second, acquiring the necessary skills to begin building a blockchain solution. Developers and business leaders who are ahead of the curve on blockchain technology will be well-positioned to reap the rewards as it matures.
About the author:
As a data scientist at Pluralsight, Abe creates cutting-edge, transformative products and platforms including the Pluralsight Technology Index—a real-time view of in-demand software technologies. Abe adores working at the nexus of statistics, economics, development, communication and collaboration.