On Monday September 10, RockCreek welcomed Dr. Tomicah Tillemann to headquarters where he led a conversation on the revolutionary potential of blockchain technology—distributed ledger technology that allows for tamper-proof transactions without the need for a central authenticator or repository.
Tillemann serves as the Chairman for the Global Blockchain Business Council, which is a global umbrella for the blockchain industry. It provides guidance for informed blockchain regulation, educating C-level executives and government officials, and facilitating partnerships among blockchain stakeholders.
Tillemann introduced blockchain as the solution to an ongoing “global crisis of confidence” in large institutions and central processing hubs. This crisis goes to the core of modern economics, markets and politics. Humans are unique because we are able to cooperate flexibly and at scale. To cooperate flexibly and at scale, we need to agree upon facts, trust the integrity of the base layer of facts, and use those common facts to collaborate. The integrity of facts can be determined centrally, by institutions, or in a distributed fashion, by participants in a network. At its most basic level, blockchain is groundbreaking because it is a form of distributed recordkeeping that ensures accuracy and is designed to be permanent. The blockchain, without any reliance on top-down validation from a government or large organization, provides a record of facts that users can leverage for collaboration.
Many industries provide use cases for blockchain technology, Tillemann said. The original is Bitcoin, an asset register in digital token form. Owners of bitcoins know that they own the cryptocurrency because there is a verified record of transactions on a blockchain that proves a coin is theirs. The public sector is using blockchain to ensure absentee votes remain anonymous. With blockchain, a coffee distributor can track even a single bean of Ethiopian coffee back to the farmer who picked it. Blockchains are offering more efficient solutions to individuals for generating and reselling energy, largely removing power companies from the equation.
Tillemann also outlined some of the limitations that are hampering wide adoption of the technology. Users are still developing and refining the blockchain’s underlying protocols. He likened this stage to the early intranets used by companies, before those systems were all linked together in one big internet. Since computers are constantly running to verify a blockchain as it continues to grow with each additional block, it takes a massive amount of power to maintain. As a result, experts are working to make the blockchain less energy intensive. Finally, developing blockchain technology requires a specialized set of skills which includes cryptography, computer science, behavioral economics, and game theory. The blockchain is beginning to establish a foothold with mainstream, institutional users, he said. The World Bank and the Commonwealth Bank of Australia, for example, recently launched a pioneering “crypto bond,” based on the Ethereum platform. Benefits of blockchain will be clear as more institutions learn about the technology. Tillemann cited recent instances when U.S. law enforcement was able to trace certain transactions logged onto a blockchain to corrupt agents who were extorting suspects. Tillemann is looking forward to a future when blockchain is seamlessly integrated into everyday life. “We’ll know we’ve won when no one is talking about blockchain.”