What is Blockchain?
Hot trend in FinTech
It is said that, “FinTech”, one of the latest trends of ICT and the finance industry, has completely changed the finance business. It is an approach aiming at providing advanced financial services by making full use of artificial intelligence (AI) and robot technology, which at first glance seems to be unrelated to the financial field.
“Blockchain” is drawn attention as one of the promising technologies to realize open financial services.
As the technology supporting Bitcoins, it has come to the fore with a lot of attention, and not only it is an idea innovation.
Bitcoin ≠ Blockchain
"Blockchain" is the concept invented as the core technology of the virtual currency “Bitcoin". Therefore, although people often inadvertently used "Bitcoin" to mean Blockchain, “Blockchain" is rather a “distributed ledger technology" that Bitcoin is using.
“Distributed ledger technology" is the technology enabling financial transactions or important data transfer that requires high reliability on an open network like the Internet. And "Blockchain" is the one at the center of attention.
A new form of system that cooperates by sharing ledger information
Many information systems maintain their own business applications and databases. On the other hand, Blockchain, called distributed ledger technology, is the concept that a part of database (ledger information) is shared across systems and each system maintains the same ledger information. In other words, it means there is a change from a world that each system holds respective ledger information, to a new world in which systems cooperate on the premise of sharing ledger information.
Taking food distribution as an example, at present, many producers and manufacturers manage their databases (ledger information) with their own systems, but when trying to achieve data coordination, there are many problems such as different data formats and management methods and different ways of synchronization.
On the other hand, if each company shares information such as manufacturing history on the Blockchain, data linkage becomes easy, and by agreeing between participants at the time of updating the ledger, the validity and consistency of the contents can be secured. And it will be possible to develop a traceability environment to prevent counterfeit or tampering without launching a costly third party organization (intermediary).
As high transparency and reliability can be secured on the internet, it is expected to be applied to various purposes.
New opportunities in spite of many issues
However, since Blockchain are decentralized, it takes a certain amount of time to check the consistency of all ledger information via the network, so it is not suitable for immediate payment where real time property is required. There is also an opinion that a low cost settlement system can be realized by replacing the existing network with Blockchain as going with the tide of FinTech. However, if you do not correctly determine the application area, you will not get any benefit from Blockchain.
In addition, there are many technical issues that must be cleared, and they keep searching for solutions in various areas. At present (2016), it is thought that it will take about two to four years at the earliest for real business introduction.
After several years, if such issues are cleared, it will become possible to construct a system which was conventionally unable to expect cost-effect at low cost, and there will definitely be areas newly systemized by the Blockchain. In NTT DATA, we will evaluate Blockchain from a unique point of view that has worked on social infrastructure, and will continue to develop technologies in collaboration with many companies.