Critics have discounted Bitcoin for years but the digital cryptocurrency keeps disrupting the world by finding new legal and illegal uses.
At its core, Bitcoin is digital gold that stores value on the internet with no centralized government authority. It replaces third-party trust with mathematical proof.
“What happens when you don’t need your bank anymore to hold money?” asked Adam Draper, founder and managing director of Boost VC. “You’re able to store value on the internet without a centralized person overseeing the money.”
Draper was the keynote speaker at the recent Blockchain Forum: Beyond Bitcoin at Southern Methodist University.
That makes it perfect for cross-border money transfers, storing value to counter hyperinflation and peer-to-peer microtransactions.
Large corporations keep Bitcoin on-hand in case they have to pay off ransomware demands.
“This happens all the time,” he said.
Power companies can use Bitcoin to pay people for electricity produced on solar panels in real time.
“They’re giving real-time payouts based on usage of the electricity,” Draper said. “That’s never been done before. I’m very, very bullish on just that use concept.”
TECHNOLOGY BEHIND BITCOIN
But it’s much more than that.
Behind the scenes, Bitcoin uses a technology called the blockchain to create a cryptographically protected ledger that can conduct all kinds of transactions.
Draper envisions a world where that blockchain tracks mortgage titles, medical records, and cargo shipments. It would essentially disrupt these established industries.
“If you are interested in experimenting with blockchain, your industry is sexy for the first time ever,” Draper said. “If you’re looking at the blockchain, you’ll have the best developers in the industry working on it.”
Peter Kirby, CEO and founder of Factom, said the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 has more than doubled the cost of a mortgage title, creating a $50 billion industry.
The blockchain creates a proof and timestamp of every document, whether it’s an original or a copy.
The same technology will be used by ShoCard to create a digital identity on a mobile device. This digital ID could be used to board an airplane, access your building at work, enter your home, and make purchases.
The digital identity uses biometrics, such as a fingerprint and facial scan, to verify the user. The data itself is encrypted on the phone. ShoCard doesn’t store any of it. The blockchain shows digital hashes every time it’s accessed.
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