Bitcoin itself is a revolutionary technology. However, it will be how empowered individuals and startups innovate with it that truly defines how Bitcoin changes the world. “Innovation within the Innovation” examines people and companies using Bitcoin in ways that truly change the game.
The Bitcoin Expo in Canada was this past weekend, and it featured a hackathon in a language not many of us are familiar with. This turing-complete language and programming is called Ethereum – and the easiest way to describe it is programmable money. The Bitcoin community is excited across the board about the possibility of programming one’s own digital financial systems, and this excitement was on display at the Bitcoin Expo.
Michael Perklin (@mperklin) April 12, 2014
The concept of Ethereum is generally mind-blowing, but from what I can gather it’s based on the idea of being able to program digital “contracts” based in Ether, the currency of Ethereum. Once a contract is programmed, one can send a command or a “transaction” to the contract, causing the code within the contract to run. This could obviously cause any number of things to happen, from Ether being released to a given party, or any other kind of financial transaction occurring. This is obviously not particularly easy to wrap one’s head around. Cryptonomics mentions a few examples in this blog post: Savings accounts, peer to peer gambling, and even new currencies within Ethereum are more than possible.
Personally I can’t help but think of the idea of financial services becoming obsolete. Taxes could become automated. Financial contracts and remittance could become incredibly simple. I doubt humans will ever become obsolete in the world of finance, but a lot of cumbersome third parties have the potential to be eliminated if a platform like Ethereum catches on. It would seem that yet another sector of the workforce is destined to be replaced by computer scientists – surprise, surprise.
We first knew Bitcoin as a digital currency. A cryptocurrency, if you will. But now it would seem it is far more than that – many are calling this developing wave of further applications of Bitcoin the Internet of Money. For all the talk in the tech community about the Internet of Things, I think it’s painfully obvious which of the two is slightly gimmicky and which may completely change the way the world works. Tax day becoming an automated process might be a generation or more away, but Ethereum is more revolutionary an idea in finance than anything I’ve seen in a long time. I wish them the best.