Blockchain vs Bitcoin: What’s the Difference?
DENVER, CO – Many would say that blockchain is driving the data center conversation, especially in regions such as the Mountain West, where the bitcoin business is booming. However, that doesn’t mean that everyone is on the same page just yet. So CapRE’s Second Annual Great Denver Data Center Summit last week featured a panel titled “The Next Chapter: Blockchain, Cryptocurrency and Bitcoin: What are They and How Do They Impact Data Center Design, Construction, Development and Operations?” and the conversation kicked off with a pretty broad topic.
“Let’s talk crypto-currency vs blockchain,” suggested Moderator Rabin Mahanty, Director of H5 Data Centers to panelist Amber Hartley, Chief Corporate Development Officer for BurstIQ. “Let’s talk about what some of the misnomers might be.”
“Blockchain is the technology platform that allows you to build immutable, auditable, longitudinal records in a distributed architecture,” began Hartley, dutifully. “The best way that I like to describe it, since I am not a technical person, is how I had to describe it to my seventy year-old mother when I got my job. And the way that I would describe blockchain is that, if you have an online checking account, you already know enough to understand what blockchain is.”
“So if you go into your online checking account, and you’ll see a ledger. That ledger has debits and credits in it,” she continued. “It’s the very same principal with blockchain, except that there are some primary differences. The first difference Is when you go to our online checking account, it’s showing you all of your transactions between you and Target, and between you and your grocery store, but the trusted broker in between those transactions is your bank. Your bank attests that you have enough money to pay for that transaction and allows that transaction to go through.”
This is different from a blockchain transaction, according to Hartley, is that you don’t need a trust-broker. “Because the blockchain provides a cryptographic, mathematical proof that you have the funds in your account or the appropriate crypto-currency to pay for that transaction,” she explained.
“The second big difference is that most data systems that are managing, for example your bank, are using centralized data systems,” Hartley shared. “Blockchain is a decentralized ledger system, which means that copies of the ledger are all over the place. In this decentralized architecture. So that’s the basics about blockchain. But when it comes to crypto-currency, instead of having that ledger in your checking account, with debits and credits, think of it as any kind of data.”
For example, this could be a real estate title. “And that ledger could be showing how that piece of land has changed hands over time you may have a sale, a lien, or any kind of activity which has happened with that piece of data,” she explained, preparing to conclude her remarks. “It could be your educational record, it could be your medical record, it could be any kind of data. And what blockchain allows you to do is have an immutable, trustable history of anything that has happened to any piece of data over time.”