Blockchain in Africa: Bitcoin vs Blockchain
Cryptocurrencies like Bitcoin, Etherium etc have been increasing in popularity over the last few
years. During this pandemic where we need contactless, cashless ways of conducting
transactions, Bitcoin and other cryptocurrencies were expected to step-up. There are conflicting
views about whether that has actually happened.
Blockchain technology
Blockchain is a distributed, decentralized public ledger that uses peer to peer network
I always like to use the term trust machine because essentially that is what this technology
offers. I like analogies because they help us simplify complex ideas.so I will give you one.
Imagine you have a piece of land that you want to transfer to another person. In order to
transfer this land, your neighbours first independently have to verify that this land is yours. (peer
to peer network) Once that is established only then can the transaction take place. Now in the
place of neighbours put cryptography, complex algorithms and different computers in different
locations that are communicating to verify transactions.
Bitcoins run under blockchain technology. I like to quote a phrase from someone who
introduced me to blockchain technology. “ It’s not only about the bloody money” So what we
hear a lot about is Bitcoin, the cryptocurrency. However, there is a technology behind it that can
bring forth a 4th Industrial revolution by removing middlemen in all or most industries and giving
the resources back to the poor and unbanked. Akon is one of the prominent people who have
embraced this technology as he aims to build a self-sustainable city in Senegal. So even if
Bitcoin isn’t living up, trashing the technology, in my opinion, would be like saying you don’t
want to use the internet because of hackers. Not wise, right?
Back to Bitcoin. There has never been a better time to get involved in learning more about this
currency. Bitcoin enables you to transfer money( send and receive) instantly across the world
without any middle institutions like a bank, Western Union etc.
All you need is an e-wallet on your phone. The transactions are very secure because of the use
of cryptography. Essentially to hack into such a system is really hard. There are complex
mathematical algorithms and the peer to peer networks which means all the networks have to
confirm before any transaction goes through. Bitcoin also uses three different cryptographic
methods at the same time. This also makes it impossible to retrieve money if you send it to the
wrong account. That’s the only disadvantage.
Why is it called Blockchain anyway?
Let’s use another analogy. Imagine you were travelling and instead of using a passport, you put
on a chain made of beads. In each bead, there some information about you. Essentially that’s
how information is stored in a chain of blocks. Thus, the name.
Conclusion
Whether you are into Bitcoin or not, I think it would be worth looking at this technology and what
innovations can be made using it to help our communities. The challenge is always that the
innovators are few. The people who talk about it in conferences are the majority.
Written by
Doreen Kainda