Building Blockchains

How the future of currency looks set to shake up the travel industry.

- Janice Leung hayes

Most people have heard of Bitcoin by now – the mysterious electronic currency created by “Satoshi Nakamoto,” a nom de plume identifying the inventor, or inventors, of Bitcoin.

Dramatic surges and wild fluctuations on the stock market have brought the cryptocurrency into mainstream consciousness, with a frenzy of investors pouring money into “mining” operations like a modern-day gold rush.

Mining in the 21st century, however, is slightly different. In very simple terms, it works like this: every ten minutes, a puzzle is formed that specially programmed mining computers race to solve. The winner receives a block of Bitcoin (currently one Bitcoin is valued at $7,368) and the puzzle resets. Alternatively, Bitcoin can be purchased with fiat currency (legal tender that is backed by its government).

By creating Bitcoin, “Nakamoto” also invented the concept of the blockchain: a database that is immutable, secured by advanced cryptography (encryption and codes) and backed up with identical copies of information on a global network of computers – something that occurs during the mining.

By design, this network is not controlled by a single authority, and has so far proven impossible to hack. The technology is complicated, but the concept is simple: blockchain is essentially a ledger or database that is open and decentralized, and allows for the creation of censorship-proof, secure, borderless, paperless currency that can’t be tampered with or changed. Bitcoin was the first, but it’s been followed by many others, including Etherum, Litecoin, Dash and Monero.

IMMUTABLE SYSTEM

Hackproof security has always been a concern in the world of Internet payments, but experts like Leonhard Weese, founder of the Bitcoin Association of Hong Kong, feel that it’s the conventional banking system that is unsecure.