Blockchain Is Broken

Investors and businesses need to look closer; blockchain right now is more of a problem than a solution.

In mid 2017 I was invited to join a government delegation to visit a global IT vendor’s advance technology prototyping lab.

What follows in this story is a little embarrassing for that firm, so they shall remain unnamed. Suffice to say it’s a well known brand name.

The lab contained demo’s and prototypes for the most exciting new technologies of our day — VR/AR, AI, blockchain, robotics, IoT etc.

One of the showcases was a conceptual use of blockchain technology. The lab set up a scale model to show how blockchain can be used in a goldmine to track the ore extracted from the mine all the way to the shipping docks.

I asked the executive who ran the lab why this was necessary. He said it was to prevent fraud which sometimes happen because truck drivers or looters may try to steal some of the load.

I probed further and asked why use blockchain instead of a traditional database and centralized server. I pointed out that blockchain itself can be hacked unless it was distributed across a large number of nodes (servers). This made it a costly infrastructure unless it was sitting on the public internet with incentives…