If you’re into crypto, you probably know a thing or two about blockchain. But did you know that it dates all the way back to 1991 and is currently approaching its fourth iteration?
Yes, over the years blockchain technology has evolved all the way from version 1.0 to 4.0. Let’s rewind a bit and find out how it became what it is today.
What is blockchain?
In case you need a reminder, blockchain is a type of digital database that’s decentralised, transparent and immutable. It offers a way of recording transactions so that anyone can see them, but no one can change them.
Blockchain operates without any centralised authority – it’s essentially a public ledger managed by a distributed network of computer systems.
So, when and how did it come about?
The first generation of blockchain centered around two things: decentralisation and cryptocurrency.
But while blockchain was officially born with the emergence of Bitcoin in 2008, the foundations for it were laid much earlier. The earliest example of a similar technology being developed was in 1991, when two scientists, Stuart Haber and W. Scott Stornetta, discovered a way of timestamping digital records so they couldn’t be tampered with.
By 1992, the method could store multiple documents in one block. This early version of the blockchain was not adopted at the time, however, and by 2004, the scientists’ patent had expired.
2004 was also the year in which computer scientist Hal Finney invented the first reusable proof-of-work system (RPoW). RPoW later became central to the workings of crypto, and Finney later became the first ever BTC recipient.
We all know what happened next. In 2008, the pseudonymous Satoshi Nakamoto published the Bitcoin whitepaper, which described a digital currency built on blockchain technology. Bitcoin launched in 2009, and while it didn’t take off at first, it eventually instigated not just the crypto revolution we know today, but the adoption of blockchain technology in a myriad of sectors.
So, what came after the initial Bitcoin era of blockchain? Phase 2.0 can be characterised by the rise of Ethereum, smart contracts and dApps. The launch of Ethereum in 2015 meant anyone could develop their own token, app or project, with the help of self-executing scripts known as smart contracts. This was a turning point for blockchain – it made people realise that it’s good for much more than just crypto.
Next came Blockchain 3.0, which turned its attention to resolving existing issues with the technology. As a result, the focus shifted from smart contracts to improving scalability, interoperability, speed, cost and security, to name a few.
Now we’re up to speed, let’s see where things are at today.
We’re currently seeing the emergence of Blockchain 4.0, which aims to build on Blockchain 3.0 and make it useable in real-life business situations.
It certainly looks like blockchain is currently evolving to benefit businesses – Blockchain 4.0 will allow organisations to move their operations to secure, trustless, decentralised applications, which should significantly increase efficiency as a result.
Increased scalability will also be the key to more widespread adoption, as it will help overcome issues such as bottlenecking and slow processing times. Should this aspect improve, blockchain technology could be used globally to protect patient data in hospitals, reduce fraud in tax filing systems and make international trading more secure.
So, is it only a matter of time before the masses realise its potential? Let us know what you think.