There’s more to the blockchain conversation than cryptocurrency. The technology, fueled by brilliant interdependencies woven through code, turned “bitcoin” into a household word. Now, businesses across the world—from finance to healthcare—are seeking ways to streamline their operations and usher in a new era of trust and accountability.We sat down with Dr. Ajay Dholakia, Lenovo solutions architect and blockchain expert, to talk about how the fledgling technology is spreading its wings and fueling intelligent transformation.
For another Lenovo expert angle, don’t miss our Extreme I.T. video, which pairs bungee jumping with blockchain basics.
And stay tuned to StoryHub for coverage of our “Future of Blockchain” summit on October 24 in Durham, NC. We’ll have experts gathered together—from MIT, IBM, and other innovators—to discuss the full potential of blockchain.
Before we get into the technology, why is blockchain even worth our time? Beyond the buzz, what can blockchain actually deliver?
Complex interactions chains already exist everywhere, from the constant conversations between devices to business supply chains and payment transactions. People have been trying to optimize these processes, and we struggle to improve even half a percentage point in efficiency, cost reduction, automation, and so on. Suddenly, there’s a new technology that promises 10-15 percent improvement. That’s blockchain.
Beyond that, trust is the biggest value prop. Blockchain data is designed to prevent any kind of manipulation by any of the parties involved.
So how does it work? What about blockchain encourages trust and transparency?
Let’s look at this in terms of four key qualities that define blockchain.
1 – Shared, Distributed Ledger. This is a decentralized database, where everyone involved in the process or chain has a copy and access to the data. We don’t keep separate books, which keeps everyone honest and transparent.
2 – Consensus. Everyone involved agrees on exactly what is recorded in that ledger–just what’s necessary to all parties.
3 – Encryption and Immutability. This is the genius behind blockchain. You enter a new transaction, and it extracts a cryptographic signature from the previous block and creates a new one. This new block then links to the next one, which picks up the signature from the current one. And on and on, so each link in the chain is indispensable and tied to the others. If anyone tries to break that chain, or augment a transaction, they have to hack the entire thing.
4 – Smart Contracts. This brings it all together. Automated bill payments already do this, but they don’t use shared, agreed-upon, and immutable ledgers. With increases in accountability and transparency, you get security and trust — that the heart of blockchain.
Okay, but what’s to stop someone from hacking an entire blockchain? Editing one link may be impossible, but what about the entire ledger?
Technically, this would be possible. But computationally it’s not feasible at all to stay ahead of all the transactions and blocks of a living ledger.
Security and trust are built into blockchain, but how does it contribute to efficiency?
Imagine you have a manufacturer, distributor, and buyer—a basic chain. In practice, each part of it could operate independently and rely on distinct databases. It could even rely on individual people who know the process and track things on paper. Synchronizing these processes requires human reconciliation steps that are notoriously error-prone.
Instead, we have a distributed ledger. Everyone uses the same database, enters the information the same way, and sees those changes instantly across the network. Add in networked devices and you start to see the real potential.
Wait, how does something like the Internet of Things (IoT) feed into blockchain?
Blockchain is part of the solution. It’s just one of the building blocks Lenovo is using to drive the next wave of intelligent transformation. We look to big data, analytics, machine learning, IoT, and blockchain working together.
Imagine a device that automatically scans a barcode and saves that information to a shared blockchain ledger. The ledger is shared so all the members of the network have a copy and can access it. And as the data grows, analytics and machine learning find new meaning and potential optimizations. You can see this working with automated systems for biometrics, supply chains, and even HR.
So what’s the hold up? Why aren’t we seeing blockchain spread rapidly?
Well, to some extent we are seeing it spread, just behind the scenes. Still, Lenovo by itself cannot decide that it will be completely transformed—the whole ecosystem needs to collectively join in. You need a network of participants, what we call a “Minimum Viable Ecosystem,” or MVE. We, Lenovo, work with a huge range of partners, and all the members of a given process need to adopt a blockchain ledger for the full security and efficiency to work.
Blockchain is a tipping point technology. Once enough companies participate, it will start to become standard practice.
Do you see much hesitation to adopt blockchain?
In some spaces. People need to move past bitcoin, so we often talk about Enterprise Blockchain. Unlike cryptocurrency, the enterprise model leans away from public, trade-based valuations. Instead, we restrict permissions and let the value be in the process or goods—whether intrinsically digital or with digital representation of physical goods.
Also, many people do not understand the value of blockchain. And even though there are huge efficiencies, businesses raise concerns: “You want me to spend extra money even though I’m still working with the same companies?”
How is Lenovo driving this forward and pushing innovation?
We want to shape the foundational technology and work with our partners to be an early, landscape-defining blockchain player. We participate in the industry bodies and communities. We’re a member of the Hyperledger project and have joined other consortiums to set new standards. And we want to use our expertise in the hardware and software to become a trustworthy advisor to our customers.
We’re also actively working on enabling new security protocols. Our Data Center Group (DCG) is building cryptographic capabilities right into servers to make them more secure. And within the DCG supply chain we’re piloting some small-network projects with Intel, Flex, and others–we’re all eager to see how this can work.
Where do you see blockchain over the next 5-10 years?
We are at the height of the hype phase for blockchain. This is new technology, and Lenovo can help realize its actual potential.
The challenge right now is, in part, sorting through competing technologies. We need to not only have individual functional networks, but networks of networks—the large intersecting chains that can make blockchain ubiquitous. So the current technologies need to talk to each other, a bit like DNS or HTML on the web. There are some foundational protocols to set in place, but blockchain is likely only a few years away from widespread adoption.
Source : lenovo