Is Blockchain same as the Bitcoin? Or Is Blockchain solely meant for the finance sector? Blockchain can never be hacked? Is Blockchain really free??
The fuss around the myths of the blockchain has risen exponentially. These myths about the newly emerged technology can confuse and disturb the long-term transformative potential of the blockchain, unless we know the facts.
So, let us put to rest some of the common myths revolving around Blockchain:
Myth #1: Blockchain is Bitcoin
Bitcoins is just the application of the blockchain technology whereas the blockchain is a technology itself. So, NO!! Blockchain is not Bitcoin.
In reality, the transactions done by the Bitcoin users are stored in the blockchain. Blockchain enables to record and store the transaction on the centralized distributed ledger.
Myth #2: Blockchain is solely meant for the Finance Sector
The future driver of digital currency – Blockchain! If this is true, are we ready?
The blockchain framework bears the potential to virtually record almost everything which is of the utmost value to the humans.
Although, blockchain has bagged enormous attention for Bitcoins, but this does not limit it’s potential to the finance sector. An Ethereum based blockchain is devised by UjoMusic which enables music artists to manage their rights digitally. Blockchain has been able to draw money and attention from tech giants like IBM, Microsoft and Deloitte.
Myth #3: There is single blockchain worldwide
There are several blockchains and each blockchain serves a unique purpose. For instance, Bitcoin is an independent public blockchain. Similarly, there are independent blockchains in domains like health care, business, crowd funding, transport and government.
Myth #4: Ethereum is Blockchain
Ethereum, basically is a platform based on the blockchain technology which enables the developers to develop different applications on it. It enables the smart contracts of transactions.
Myth #5: Blockchain cannot be hacked and is a solution for all cyber frauds
Blockchain has been touted as invulnerable to cyber risks. This is because of blockchain USPs like transparency and inherent permanence. The nature of blockchain claims that to tamper any data existing on a blockchain, one has to make changes to the records stored on multiple computers/nodes.
In the history so far, there have been several examples where the blockchain or the data within it have been tampered. Bitfinex, which is a Hong Kong based company, lost $66 million when their data was exploited. Apart from this, Decentralized Autonomous Organization (DAO) played a victim to a cyber-attack leading to losses of about $61 million.
No system or database in the world can be 100% secure. What blockchain offers to its applications is the way to catch any unauthorized changes in its records, if any made.
Myth #6: Blockchain is cheap to use
As we know that Blockchain needs multiple computers for its operation. The cost of mining the Bitcoins is extremely high. As a result, the computing powers needed to operate blockchain would incur costs like electricity, infrastructure and man power.
This myth has gained so much momentum for the transactional fees from one user to other, irrespective of location is way too lower than conventional money transfer.
Myth #7: Blockchain is just meant for business interaction
Blockchain technology experts are very much convinced that this technology will revolutionize the global economy like the internet did in 90’s. Blockchain is accessible to everyone everywhere and is not confined to just B2B interactions.
If all it takes is an internet connection to access the blockchain technology, we can imagine how many people can interact globally. For instance, any individual can do any business globally and no commission or third party interference would be required. Anyone can exchange remittance without going through expensive intermediaries.
Due to lacking identification documents, several people, largely from the developing nations, are deprived of banking facilities. This loophole can be efficiently bridged by the blockchain technology.
Myth #8: All the existing blockchains are public
While it is true that the most popular existing blockchains are all public. However, the blockchains can be of three types namely public, private and semi-public.
The fundamental difference that lies between a public and a private blockchain is who has the access to the blockchain. For instance, Corda, which was developed by R3 consortium is a private blockchain whereas Bitcoin is a public blockchain.
Myth #9: Private information on the blockchain is public
Privacy is one crucial parameter that is considered by everyone who tries to explain blockchain. A lot of people assume that all the information and transaction details are public in a blockchain, since the distributed ledger is public. Well, this is absolutely untrue.
Myth #10: You can store your files on blockchain
Blockchain doesn’t enable data storage. All it can provide with is the proof-of-existence of any particular data.
Thus, these were a few common myths revolving around the blockchain. Unavoidably, with the emergence of any new technology, there will be broad confusions, which in case of blockchain technology is more. Unless, fact is separated from fiction the users wouldn’t be able to know the actual potential of this highly transformative technology where the rules of trading are completely different and has completely innovative operating model.
Now, that the buzz around the blockchain myths became clear to you, if you have any innovative concept where you want to implement Blockchain technology, write to our team of experts at email@example.com