This week’s Economist is uncharacteristically effusive about the blockchain. On the cover, it calls it “The Trust Machine”, and says that it is a technology that “could change the world”.
In a lead article, it explains that the
blockchain lets people who have no particular confidence in each other collaborate without having to go through a neutral central authority. Simply put, it is a machine for creating trust. … it is a shared, trusted, public ledger that everyone can inspect, but which no single user controls.
The decentralized cryptocurrency, Bitcoin, is the context in which the first blockchain has been developed. That blockchain keeps a continuous, almost real-time, track of currency transactions, and prevents double-spending. Although this is one use to which the blockchain concept can be put, the Economist emphasizes that there are countless other applications:
One idea, for example is to make cheap, tamper-proof public databases … [such as] registers of the ownership of luxury goods or works or art.
Just as I don’t have to understand the workings of the internal combustion engine to drive a car or take a bus, or understand the workings of a processor to use a laptop or a smartphone, I don’t have to understand the workings of the cryptography at the heart of the blockchain to spend a bitcoin or confirm the ownership of a good. So, I’m going to assume that the blockchain works, and suggest that it might provide a solution to a problem which bedevils the resale of digital goods.