Blockchain technology is becoming more than a system that powers cryptocurrencies such as Bitcoin and ether, created by Ethereum; it’s part of a sociocultural movement that is disrupting the finance industry, among many others, and it could change the internet as we know it.
Joseph Lubin, founder of the Brooklyn tech company Consensys, is enthusiastic about the future of this disruptive tech. Lubin is developing decentralized applications, known as dApps, on Ethereum’s blockchain that will, purportedly, lower transaction costs, making it easier and cheaper for business owners to enter markets and put more money in the pockets of content creators. Last year, Lubin said that “if you think the internet has affected your life, Ethereum will have that same pervasive influence on our communications and our entire information infrastructure. It will impact every aspect of our existence.”
Was he right? The changes Lubin talked about haven’t come to fruition yet, but Ethereum and the idea of a more decentralized internet space are gaining traction. Ether—which powers Ethereum’s blockchain—has risen 900 percent in value since the beginning of 2017. Cryptocurrencies have surpassed their niche, tech-nerd following, with major news outlets, big banks, and governments all starting to pay attention.
Cryptocurrencies have been reported to gain in value in times of political uncertainty. Following events such as the 2016 US election and recent elections in France, ether jumped in price, perhaps in response to worry over how markets would react to Donald Trump and Marine Le Pen presidencies.
Also relevant is the reignited issue of net neutrality—the principle that all internet activity should be treated the same, with service providers, regulators, and governments not allowing discrimination in cost and availability of internet services. The most notorious example of this is the 2005 scandal where Telus blocked access to a pro-union website during a heated labour dispute among its workers.
Here is where the Ethereum blockchain can cause big changes. Advocates for a more democratic internet space, a decentralized online market, a more transparent record of transactions, and an international currency that is separate from local fiat currencies would be eager to adopt this paradigm shift.
The Ethereum blockchain and its dApps have the potential to replicate services like Facebook, Spotify, Uber, Airbnb, and more. How might it work? Using the music industry as an example, instead of paying a monthly service fee to Spotify—who, in turn, pay artists fractions of a cent per stream—users would access music through a blockchain dApp. Users would pay using a digital currency, and the blockchain would execute a smart contract that directly paid the artist, based on predetermined rules. With no central authority, the smart contract could, for example, pay the songwriter 50 percent of the transaction and split the other half between members of the band. There would be no intermediary extracting money out of each transaction, leaving more for the artists.
Is this the future of the internet? Sign me up.