Comstock's magazine 0419 - April 2019 - Page 46

n BLOCKCHAIN has increased every year since Vermont passed the first one in 2015. California universities are in on the action too, with three of the top 10 universities for block- chain classes in the world located here: Stanford, UC Berkeley and UCLA. Locally, UC Davis has a student-run blockchain organization supported by a team of professors and a blockchain club at the Graduate School of Management. Not everyone believes the visions of blockchain evangelists. Jimmy Song, startup veteran, develop- er, programmer and partner at San Francisco-based venture capital firm Blockchain Capital, told an interviewer last September that in 2013, he began looking at a lot of blockchain projects as potential investments. Many of those “purported that they’d be changing everything. … A lot of those projects have gone nowhere,” he said. At the blockchain world’s biggest conference in May 2018, he told at- tendees that most blockchain projects won’t fix the problems they aim to because they don’t eliminate the need for a trusted third party, according to news accounts of the event. Onstage, he bet another speaker, Joseph Lubin of blockchain giant Ethere- um, that blockchain technology won’t have any sig- nificant use in five years. (It’s unclear if the bet was ever consummated.) Why is he a partner in a block- chain venture capital firm? He believes in block- chain’s use in powering Bitcoin but not much else. Blockchains aren’t unhackable and can be breached if an outside entity gains control over at least 51 percent of the computing power. This is what happened to cryptocurrency Ethereum 46 | April 2019 Classic in January, leading to the theft of more than $1 million worth of the currency, according to news reports. Though that was the first incident of its kind, it isn’t outside the realm of possibility that the development of quantum computing — tens of thousands to millions of times faster than current systems — could use its massive power to defeat a blockchain’s encryption. (Of course, quantum com- puting also would put our current centralized sys- tems at risk.) DEATH OF A MIDDLEMAN But if Song is wrong and the proponents are proph- ets, blockchain applications will upend how trans- actions happen. Take real estate. Imagine logging in to your computer to access your credit data, which is stored on a blockchain. Your data are pub- lic — stored on thousands of computers — but no one can tell that those data are connected to you because your identity is protected by a strong cryp- tographic key that you control. And the data is near tamper-proof because it’s on a blockchain. When applying for a home loan, borrowers can make their entire credit history — not just a score or snapshot — instantly available to lenders. Lenders bid, and the borrower picks the best deal. Increased competition and no more preapprovals or long loan applications, with lenders taking 30-60 days to make a decision. That’s the scenario envisioned by Graham Mc- Bain, who directs the McClellan Innovation Center, cofounded Sacramento blockchain startup Lay- erOne and is a former real estate agent. (LayerOne