The primary concept of a block-chain pertains to chain of records(ledger) which captures transactions made in crypto-currency with a primary function to :
A) publicly & chronologically record &
B) decentralize the ledger
In such a system every node or participant in the transaction get a copy of the blockchain. At the end of the day what doesn't change -- is that the transaction still occurs between 2 parties one on the 'initiating' end & another on the 'receiving' end.
Well, the first question which comes to mind is ... why do we need block chain, why introduce more complexity into a system which already quite complex. Think of it, a transaction between two participants happening across 2 different regions of the world can account upto so many sub-ledgers, re-conciliations, or connected pieces being updated, why introduce another element here?
So - the reason is simple - 'time is money' - and the question really boils down to the fact - that if -
a) introducing a block-chain - would it reduce my time to carry out the transaction?
the answer here is simple - yes - because now to establish authenticity - you don't have to go through 'n' different channels but look at one record of block-chain and get that answer.
now the point a) above leads to point b) which is if the time is reduced does it lead to the security of the transaction being compromised?
b) making the ledger public means making sure - it is not a single entity which holds control over the authenticity of the ledger but a group of entities & it makes it even more difficult to corrupt or change the ledger by any means during the process of the transaction.
This is similar to the opposite of the old saying that if I keep my system out of cloud - I am more secure, just because nobody is watching me, think on it because anyone can argue otherwise - if you keep your system in the cloud - the network ensures that the system is handled by the best and the latest to make it secure, so it might be you may be on the losing end if not on the cloud when it comes to a compromise.
So basically at the end of the day - we are achieving a reduced time-frame of the transaction over a more secure channel, seems like a win-win - but there is a cost here - in order to take advantage of the blockchain the accounting needs to be done on a crypto currency - which can be any crypto currency like for e.g. - bitcoin, ethereum, dogecoin, etc.
So we answered the first question - 'Why blockchain', now let's look at the second aspect - 'Why now?'
The whole idea of block-chain comes down to providing the above 2 advantages with an opportunity to make the system more & more - 'decentralised' - which mean's - you wouldn't have to be a major participating body to exercise control or take advantage of this system, you can be a small entity trying to use the system and getting the same benefits which a bigger and established entity would recieve. This idea dwells very well with the concept of modern day technologies - let's take an example - so much of solar power is generated but the power distribution is still not at the peak of consumption at the point of production - meaning where it's needed when it's needed - how to solve the problem - use 'internet of things' devices that talk to each other and let them do the math using a secure channel of distribution - which is block-chain, this gives quick decisioning and make the distribution much quicker.
The one fundamental difference when doing a transaction on such a channel or network is the ability to time travel in history to the point when the record was first created. This gives the authenticity and knowledge about the accuracy and worthiness of the record, so that when the dealing happens - we are sure that the price paid is a fair price.
Well, now that we somehow get an idea of why blockchain & why now? - let's carry on further to understand - how & when aspects?
So as of today market's may be stable or very unstable, markets can be doing perfectly fine in one part of the world at the same time being perfectly erratic in another part, there could be certain governing powers when it comes to establishing the flow of the financial elements from one part or region to another - on one day and completely different on another day - in such an indeterministic world with a trillion complex plausibilites which ones do you trust - well - before I say it - you might have an answer - 'block-chain'.
But primarily the idea of block-chain is to reap on some of the advanced concepts in technology - be- it AI or Internet of things working along with AI where a decisioning can rest on a block-chain record and it would rather take tremendous amount of effort & time for a highly complex AI cyber-security engine to even try to replicate the chain be it altering it... notifications would follow very quickly.. because as we are growing the speed of thinking with human thinking slowly is being out-powered by the machine - it's important to think of a possibility where your usual data security might not be effective enough... so the question basically boils down to 2 factors - when do we start thinking seriously about it?
... or when is it too late to start thinking about it?
