Two years ago, when everyone was hyped about bitcoin and other cryptocurrencies, people like me were writing, “This is nothing, wait until we get to blockchain.”
Blockchain, an encrypted, shared, database, built with open source software and organized as a general ledger, was the revolution. Everyone would be able to see the ledger, but encryption would keep transaction details secret, allowing security.
This would change everything.
Now it’s 2019 and these kinds of mass market applications are starting to appear.
One of the most hyped is QLC Chain. Its software or Mainnet is now available at popular open source repositories. The network is due to go live on May 28 when its Q-gas tokens begin distribution inside the network.
Financial Transactions Via SMS
The twist is that QLC Chain lets SMS messages, which could come from simple software applications, carry financial transactions. Anyone who participates in the chain gets to share in its low costs. Montnets’ customers include all the leading players in China’s internet, as well as its mobile operators.
The chain claims to offer distributed security, distributed billing and peer to peer addressing built on IPv6. Transactions are automatically encrypted, so settlements are instantaneous. Members of the chain will be able to verify the IPv6 address of every transaction message, which they can use to ensure senders are credible.
The hope/expectation is this will create profitability in transactions between software applications and their users, building an infrastructure in which money can move instantly, without cost. SMS billing has long been troubled by things like spamming, phishing, and other types of fraud. Despite this, it was a $62 billion market in 2017.
What Can Go Wrong?
As with all blockchain networks, it’s tokenizing money — turning currency into bits and back into money — that is the key.
The more money that goes into applications supporting blockchain, tokens that can be exchanged for one another before they pop back in someone’s pocket as “fiat” currency, the more valuable the whole space becomes.
But there’s a contradiction. If something is increasingly valuable, speculators are going to dominate the market. But if cryptocoins are subject to speculation, their values become unstable, making their blockchains less useful as sources of transactions.
Despite this, the hype train must run in order to get companies into the technology. The hype machine is currently focused on 5G, the fast, ubiquitous cellular technology now being rolled out by carriers. That’s because 5G is due to be embedded in anything with intelligent sensors — homes, cars, utility meters, even traffic lights. Combine the security of blockchain with the ubiquity of 5G, the hype goes, and anything can become a metered service.
The Bottom Line
The main benefit of blockchain is lower transaction costs. This would enable the kind of micro-transactions that might let you pay for, say, reading this story as a service, for the portions of a penny it’s worth, and have most of that money flow to InvestorPlace, or even to me.
If this is going to change everything, you don’t want to be left out. If.
Dana Blankenhorn http://www.danablankenhorn.com is a financial and technology journalist. He is the author of a new mystery thriller, The Reluctant Detective Finds Her Family https://www.amazon.com/Reluctant-Detective-Finds-Her-Family-ebook/dp/B07FSRDR4Y/, available now at the Amazon Kindle store. Write him at firstname.lastname@example.org or follow him on Twitter at @danablankenhorn. As of this writing he owned shares in JPM.
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