Do we need blockchain without cryptocurrencies?

Jul 10, 2018

While cryptocurrencies fall in price after the news about a hacker attack on the South Korean exchange “Bithumb”, analysts argue about the revolutionary character of blockchain and its advantages in isolation from cryptocurrencies.

Cryptocurrencies = trust

According to professor Kevin Werbach, nowadays there are many things whose value is based exclusively on trust. Without trust, money is simply paper, elections — a senseless ritual and so on. The trust to all these institutes is supported by the existence of all sorts of supervising instances — partners, intermediaries, third parties. In this sense the idea of cryptocurrencies is revolutionary, because it creates a system which does not require control from the outside, but can be instantly trusted by checking transactions which are accessible to every participant of a chain.

The tracking blockchain

The same problem in gambling is solved by blockchain, where the question of trust between players and game organizers costs especially dearly. Before the appearance of blockchain the trust of players to an online casino was ensured by special commissions which tested the equipment of a casino and, based on the test results, granted a casino its licence. That is, the trust in gambling has been based on the participation of third parties and depended on the trust towards the procedure of casino licencing itself.

The technology of blockchain solves this crucial problem of gambling and allows to create really fair online casinos in which prizes depend neither on the game organizers, nor the players. Such casinos do not require any more licences from the supervisory instances, because every player can be convinced of its honesty by looking at the transaction record in a blockchain.

FairWin blockchain slot

The casinos on blockchain have some disadvantages connected with the low speed and high cost of transactions (actually, all games on blockchain face this problem). Developers offer different variants of the solution for this problem. For example, the FairWin team is developing a special data transfer channel, called FairChannel, to boost the game speed and record all game turns.

Blockchain in isolation from cryptocurrencies

Even despite this, according to professor Werbach, blockchain has a certain speculative element because essentially it does not offer any brand new business model, but fulfills a rather cosmetic function, if taken separately from cryptocurrencies.

Theoretically, blockchain does not need the cryptocurrency, just like the idea of cryptocurrencies does not require blockchain, but it is practically impossible to imagine one without the other for today. It is clear that the possibilities of blockchain are not limited to cryptocurrencies, but at present its potential is not fully unlocked and the technology is most successfully applied in conjunction with cryptocurrencies. Although, probably, the situation will change in the future and blockchain will become an indispensable part of our daily life.