What is Ethereum?

Ethereum describes itself as “a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference.”

The term “smart contract” refers to computer code that can facilitate the exchange of money, content, property, shares, or anything of value. When running on the blockchain a smart contract becomes like a self-operating computer program that automatically executes when specific, defined conditions are met.

Ethereum was proposed in late 2013 by Vitalik Buterin, a cryptocurrency researcher and programmer and launched in 2015.

The platform is also the basis for its own virtual currency, Ether.

Ethereum is not just a platform.  It’s also a programming language, helping developers to build and publish distributed applications.

As an example for comparison and contrast, Bitcoin is also a distributed public blockchain network.  Although there are important technical differences between Bitcoin and Ethereum, Bitcoin solely exists to offer one famous application of blockchain technology: a peer to peer electronic cash system that enables and tracks online Bitcoin payments.

Conversely, the Ethereum blockchain focuses on running the programming code of any decentralized application.

In fact, Ethereum is also being used as a platform to launch other cryptocurrencies

In the Ethereum blockchain, instead of mining for bitcoin, miners work to earn Ether, a type of crypto token that fuels the network. Beyond a tradeable cryptocurrency, Ether is also used by application developers to pay for transaction fees and services on the Ethereum network.

There is a second type of token that is used to pay miners fees for including transactions in their block, it is called gas, and every smart contract execution requires a certain amount of gas to be sent along with it to entice miners to put it in the blockchain.

Visit the following link to see what types of Dapps are being built on Ethereum.

PWC Blockchain 2018

PricewaterhouseCoopers (PwC) is a multinational professional services network headquartered in London. PwC ranks as the second largest professional services firm in the world behind Deloitte.

In PwC’s 2018 survey of 600 executives from 15 territories, 84% say their organizations have at least some involvement with blockchain technology.

Additional highlights:

  • 45% believe trust could delay adoption
  • 30% see China as a rising blockchain leader
  • 28% say interoperability of systems is a key for success

Furthermore, they outline four strategies for blockchain success:

  1. Make the blockchain business case: evolution, not revolution
    Strategic clarity will ensure that your blockchain initiative has a business purpose around which you and other participants can align.
  2. Build an industry ecosystem
    Blockchain may call for competitors to collaborate in a new way, as they come together to solve industry-wide problems.
  3. Design deliberately
    Every blockchain will require rules and standards, particularly around what various participants will be able to access and how they can engage.
  4. Navigate regulatory uncertainty
    stay agile to meet regulatory requirements as they evolve in the years to come

Blockchain and The Promise of Value to Users and Developers Instead of Shareholders

Brendan Blumer, the CEO of Block.one, presents his keynote speech on Sept 26, 2018 in Olympia, London for the Blockchain Live 2018 conference.

Blumer outlines a cogent overview of blockchain and its transformative promises.  He notes that it is a technology that welcomes everyone with no prerequisites and which will inevitably become part of our future.

Blumer offers this definition: Blockchain is simply a mutually agreed set of standardization of data storage and transmission. It’s a set of constraints that developers agree to abide by in order to obtain security, auditability and interoperability.

He suggests an analogy that blockchain is to data in some ways what regulation is to society.

He describes blockchain as a social and economic movement that offers the promise of a more transparent, efficient and interoperable world.

Blumer notes it includes a promise that, over time, it will allow our governments to better represent all of us.

He highlights how blockchain can transform centralized platforms, like Facebook, Uber, Airbnb, GitHub, insurance institutions and banking, into decentralized networks, where the profits of such networks would be minimal to non-existent and any excess value could be driven back to those who contribute to the prosperity of the project.

Blumer further elaborates: “Shareholders, as we currently understand them, are in many cases beginning to represent pricing inefficiencies and we may yield them less competitive to projects with perfectly priced goods and services.”

As an example, he describes a social network that rewards users with tokens for content creation, and requires advertisers to purchase those tokens, which drives value to the users, as opposed to traditional shareholders.

He remarks upon the democratization of blockchain with the idea that transparency may usher in a new era of equality and accountability.

Blumer describes blockchain tokenization as an opportunity that allows consumers to store value in projects they know and understand, which they can also engage in for their own prosperity.  In such a tokenized economy the activity of early discovery and evangelism can and will be a career in itself.

The Future of Blockchain and Decentralized Networks

Matthew Spoke, CEO of Aion Foundation, speaks about the future of blockchain and decentralized networks.

Aion refers to itself as “a multi-tier blockchain network designed to support a future where many blockchains exist to solve unique industry problems and to power the services of the modern world.”

In this talk, Spoke discusses the evolution of human societies and notes that societies were built around geography and limitations of information and resources.  More specifically, he points out how throughout history, social structures have been built on hierarchies.

He compares how, historically, evolution occurred slowly. Whereas now we are seeing massive transformations year after year.  He proposes that the world has changed and governance needs to be re-thought because our social structures are not reacting fast enough.

He suggests that instead of being organized by geographies and hierarchies, that we should replace hierarchies with networks

Networks connect sovereign units. And in regard to organizing our world, networks could connect:

  • Sovereign individuals
  • Sovereign products
  • Sovereign cities
  • Sovereign autonomous organizations

What’s needed in such environments are clear definitions and rules which represents a truth for all connected via any specific network.  Which is how blockchain works.

Spokes further outlines how the internet evolved in a way in which large, centralized monopolies control our digital lives.

Blockchain allows us to revisit and re-architecture this arrangement since blockchain does not require these centralized monopolies.

He highlights how the internet is built on 12 basic protocols.

Blockchain will also evolve with layers and layers of protocols to solve different problems, but we’re very early in the development cycle in that we are still building base layers of blockchains.

However, in comparison to the development of the internet, this time with blockchain it will be different because blockchain has a built-in economic design. If you participate in the development, you can benefit as the network grows. Blockchain includes the concept of an owner inside of a global infrastructure. Nevertheless, it takes time to build these technologies.

Lots of projects will run out of money in the next few years.

Also, first to market doesn’t always win.

At the end of the day, global engineers and researchers are working to build a new internet of value.

Congress Seeks to Define ‘Blockchain’

One of the challenges of blockchain technology is its lack of interoperability between different networks. As the technology evolves, developers around the globe are working on platforms that do not play well with others.

That’s not an oversight.

There simply is no existing standards. 

Yet.

However, a bill is being introduced to as least establish a definition of blockchain itself as a basic starting point of coordinating future technological development.

H.R.6913 – Blockchain Promotion Act of 2018 is the name of the bill.

U.S. States are also trying to come up with their own definitions.  Such efforts are laudable. Yet, a broader attempt is necessary to establish an industry definition that not only crosses state lines, but ideally would be globally respected.

An industry definition is a good start to more efficient blockchain development and deployment.

4 Blockchain Benefits for Marketers

Marketing hype around the benefits of blockchain have largely focused on the financial sector.  However, the promise of opportunities for all industries and commerce in general is often advised. In brief, blockchain provides more efficient financial and informational transactions.  It also facilitates greater transparency and accountability.  And all for lower cost.

The fact that blockchain can also eliminate or minimize middlemen along operational or supply lines will disrupt the world by itself.

But what are the benefits of blockchain for the marketing and advertising sector?

The following article, How Blockchain Can Help Marketers Build Better Relationships with Their Customers, expands upon the following even further.  In brief, here are four blockchain benefits for marketers.

  • The Marketing Impact of Near-Zero Transaction Costs: Are 3% payment processing fees really worth it? Especially when margins for many companies are getting slimmer all the time? With blockchain those fees are practically nonexistent.
  • Ending the Google-Facebook Advertising Duopoly: In 2018 it’s hard to imagine a marketing plan that does not include Google Ads or Facebook Ads, or both. But it wasn’t that long ago that Facebook ads didn’t exist.  It wasn’t that much longer ago when Google Ads didn’t exist. But what if we could connect directly with consumers and pay them for their attention? They are rightfully the ones who should benefit from the marketing relationship. Personally, it’s hard for me to imagine Google and Facebook going away and it’s highly probable they have some of their best minds working on how they can use blockchain to still be relevant to marketers in the future. One thing is for future. The marketing and advertising landscape will be changing and both consumers and marketers will be the primary beneficiaries. (Especially consumers).
  • Ending Marketing Fraud and Spam: Two blockchain factors will be working against fraudsters and spammers: Transparency and micropayments, enabled by point 1 above (near zero transparency fees). It will be much harder for bad actors to hide in a blockchain world. Although I wouldn’t suggest that it will become impossible, it will be fundamentally more challenging. The internet, up to now, has made it ‘not’ challenging to be an anonymous bad actor online. The inherent transparency of blockchain will force some bad apples to go straight and others to go elsewhere. And the fact that that there could be an opportunity for companies to pay for consumers to click their links means that spammers would be pushed aside due to unworkable economics.
  • Remonetizing Media Consumption: Paying true content creators for their work is an overdue promise of the internet and may finally be delivered via blockchain. Rightful ownership of property via smart contracts is a cornerstone benefit of blockchain. Figuring out how to manage the commerce of such is being figured out in the present.

In recent years I have started becoming jaded about the internet, which may have taken me longer than others, since those of us who jumped on the internet in the mid ’90s would have been pioneers of that earlier world-changing technology. And although the world was indeed changed in profound and meaningful ways, personally, I found it disheartening to find such a massive opportunity for good also be used for less than good, as well.

Blockchain has reignited my own earlier vision of not only what the internet could be, but what a better world could be.

Blockchain’s Five Challenges

According to Deloitte, which is the largest professional services network in the world, there are five things that must happen for blockchain to see widespread adoption.

None of these are news for those following the blockchain industry. And most in the industry are also aware that progress is being made to resolve each of them. Nevertheless, here are the five items:

  • Increased performance
  • Interoperability
  • Reduced complexity, cost
  • Supportive regulation
  • More collaboration

See the complete article here:
https://www.cnbc.com/2018/10/01/five-crucial-challenges-for-blockchain-to-overcome-deloitte.html

$1B to Help EOS Flourish

Block.one is the company behind the EOSIO blockchain, which is the brainchild of CTO Dan Larimer. The company bills EOSIO as “The most powerful infrastructure for decentralized applications.”

Brendan Blumer is the founder and CEO of Block.one and in the above video he discusses the company’s $1 billion investment to foster the expansion of their blockchain.

Blockchain: A New Marketing Paradigm

Eventually (in the not-too-distant future), blockchain will impact most commerce.  It will make business and operations more efficient, more accountable, more transparent and less expensive.

The rise of cryptocurrencies as a speculative asset, culminating at the end of 2017, as well as the crypto bear market of 2018, may dominate the hype cycle, but the real work of blockchain development is still in an early stage of changing the world.

In terms of blockchain as a base platform for practical applications, the financial technology sector has captured a chunk of the spotlight and the battle lines are being drawn for a new era.  How much (or little) traditional banks and governments will be able to influence global exchange of value is in the process of being determined.

However, all sectors can, and ultimately will, be influenced by blockchain.

On a fundamental level, blockchains cut out expensive middlemen such as banks and lawyers, so the opportunities for increased productivity are significant.

In relation to marketing, the following article, 7 Ways to Build Your Brand with Blockchain Marketing, suggests a new marketing paradigm:

By contrast, the blockchain offers a different approach to digital ads and marketing. The decentralized, peer-to-peer model brings the customer into equal, dynamic dialogues with businesses, and lets customers generate monetized marketing content for their favorite brands through that engagement. This implies that in the earned media blockchain ecosystem, we are all equal and active partners.

Perhaps one of the more interesting opportunities for marketers is the promise of bypassing advertising middlemen, such as Google and Facebook, and putting messages directly in front of those who are interested.  At a reduced cost, no less.  In fact, the ad payments would go to those consuming the messages. (And/or those creating messages for the brand).

Of course, in the same way that banks are going to do their best to stay relevant, by placing themselves within the blockchain, advertising middlemen, Google, Facebook, et al, will do the same. It seems probable that their ban on crypto ads this year is an attempt to pause the momentum so they can evaluate the space to their advantage.

I do not suspect that Google and Facebook will go away (although some other intermediaries probably will).  They need ad revenue to survive and they’ll figure out some way to maintain a slice of that pie.  However, expect  that names of companies with whom we are yet not familiar, will come to be just as well known, and perhaps more so, for no other reason than providing more value for less cost.

Regardless of how the advertising media landscape plays out, marketers and consumers will win.

Dan Larimer Explains EOS

Dan Larimer, CTO of EOS, discusses his latest blockchain in this video, which is edited from a number of presentations.

Larimer is noted for creating two earlier, and still popular decentralized blockchains:

  • Bitshares
  • Steem.

From those projects he conceived what he considers to be a better platform, which has led to his current development of EOS.

Philosophically, he was inspired by free markets, Austrian economics and Ron Paul. As a result he wanted to create systems that would provide freedom and are nonviolent.

Larimer’s life mission in to “Find free market solutions for securing life, liberty and property.”

Hence, we need money that is not controlled by a central authority.

He recognized the vulnerability of crypto exchanges, which could be shut down by governments, cutting the flow of digital currencies.

From that he created Bitshares (BTS) a Decentralized Asset Exchange. But that wasn’t up to the task of handling the required scalability.

He created Steem, a blockchain social media platform that rewards users for creating content. Transactions on Steem are free. But it moved away from a core principle of true decentralization.

Larimer is no longer involved with Bitshares or Steem and both of those platforms are doing well.

However, from his perspective, the industry has much to learn and with his past experience and ongoing learning he is building EOS for the purpose of establishing future applications on top of it with the intention that anyone, including himself, could develop on it.

EOS enables developers to build decentralized applications in a general purpose way, which are compatible with sustainable growth.

EOS is an open source platform that anyone can use to develop high-performance, decentralized, blockchain smart contracts.