How the blockchain will change our society

LEAD: Mr. Müller, Blockchain is supposed to become the big digital revolution par excellence, and yet hardly anyone can say how this technology works. How would you explain to a child what Blockchain is?

Collin Müller: In the classroom, the child has the task of distributing a sack of sweets. And that certainly leads to quarrels if the teacher does not help. But that’s where the blockchain comes in. This is a magic box containing all the sweets. The Blockchain ensures that every child gets a fair amount of candy without the need of a teacher.

LEAD: So what’s going on here?

Müller: Up to now, middlemen always make sure that everything is fair and everyone plays by the rules. Some call these intermediaries “intermediaries”. These are, for example, banks, notaries or central online platforms such as Amazon or Paypal. The blockchain replaces these intermediaries. For Bitcoin, for example, this is the bank. The technology uses algorithms to make sure everything is fair and everyone plays by the rules.

LEAD: When and how will Blockchain shape our everyday lives?

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Müller: In the next two years not at all, in the next 10 years massive. This is similar to the smartphone in 2007. No one could imagine that we will use this device at some point almost for everything in life. And it will be similar with the Blockchain, where more will happen in the background. So, as few people can really explain how to program an app or website, very few people will be able to explain how a blockchain works in detail. And everyone can still use the website. That’s how it will be with the Blockchain. It will of course regulate many processes in the background, then switch off the intermediaries in many places and we will work with them without most people even knowing that a blockchain is currently running in the background.

Actually, it’s not that hard to understand the technology. For fun, we’ve explained all the important Blockchain concepts on TheBlockchainBar with a small bar. The guests run the bar itself – without a host as a middleman.

LEAD: What can you do with the Blockchain?

Müller: The best application example today is the transfer of money. Thanks to the Blockchain, you can already send money today, without the need for a bank. That’s what you do with the so-called cryptocurrencies, that is with digital money.
Rather, companies will integrate the blockchain into their systems. It allows, for example, “smart contracts”. These are automatic processes and transactions between the participants that take place in a decentralized blockchain network. They all operate this network together. So you do not have to trust a partner that he does everything fairly and correctly and does not look unjustified into the data of the others. The first prototypes of this are already available in global logistics chains. But even the automatic processing of advertising directly between reach providers and advertisers is conceivable without middlemen.

LEAD: What is it that makes Blockchain so revolutionary?

Müller: The Blockchain has what it takes to be the next digital revolution. It can change even more than the web itself. The Internet has not dissolved the existing structures, but has significantly accelerated the processes. I used to order from the Otto catalog, today I do that via Amazon. The banks are still there, just online banking. What the Blockchain is doing is a bigger revolution. It changes the organization of our economy and society by replacing the big intermediaries with a technology.

In the future, we will not need banks, insurance companies, or even online marketplaces. The blockchain is changing the basic organization of our society that has existed for at least five thousand years. Since then we have the big intermediaries to organize our society. And now comes a technology that has what it takes to resolve everything within a few decades. And that’s the really exciting thing about it.

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(Photo: Collin Müller)

For more than twenty years, Collin Müller has been helping companies achieve growth and efficiency through digital transformation. On Blockruption.com he blogs about Bitcoin and the Blockchain and how the great opportunities of this revolutionary technology can be meaningfully used.

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