How blockchain and cryp­tocur­ren­cies look set to change travel

How the fu­ture of cur­rency looks set to shake up the travel in­dus­try

Business Traveller (Asia-Pacific) - - CONTENTS - WORDS JANICE LEUNG HAYES

Most peo­ple have heard of Bit­coin by now – the mys­te­ri­ous elec­tronic cur­rency cre­ated by “Satoshi Nakamoto”, a nom de plume iden­ti­fy­ing the in­ven­tor, or in­ven­tors, of Bit­coin. Dra­matic surges and wild fluc­tu­a­tions on the stock mar­ket have brought the cryp­tocur­rency into main­stream con­scious­ness, with a frenzy of in­vestors pour­ing money into “min­ing” op­er­a­tions like a mod­ern-day gold rush.

Min­ing in the 21st cen­tury, how­ever, is slightly dif­fer­ent. In very sim­ple terms, it works like this: ev­ery ten min­utes, a puz­zle is formed that spe­cially pro­grammed min­ing com­put­ers race to solve. The win­ner re­ceives a block of Bit­coin (cur­rently one Bit­coin is val­ued at US$7,681) and the puz­zle re­sets. Al­ter­na­tively, Bit­coin can be pur­chased with fiat cur­rency (le­gal ten­der that is backed by its gov­ern­ment).

By cre­at­ing Bit­coin, “Nakamoto” also in­vented the con­cept of the blockchain: a data­base that is im­mutable, se­cured by ad­vanced cryp­tog­ra­phy (en­cryp­tion and codes) and backed up with iden­ti­cal copies of in­for­ma­tion on a global net­work of com­put­ers – some­thing that oc­curs dur­ing the min­ing.

By de­sign, this net­work is not con­trolled by a sin­gle au­thor­ity, and has so far proven im­pos­si­ble to hack. The tech­nol­ogy is com­pli­cated, but the con­cept is sim­ple: blockchain is es­sen­tially a ledger or data­base that is open and de­cen­tralised, and al­lows for the creation of cen­sor­ship-proof, se­cure, bor­der­less, pa­per­less cur­rency that can’t be tam­pered with or changed. Bit­coin was the first, but it’s been fol­lowed by many oth­ers, in­clud­ing Etherum, Lite­coin, Dash and Monero.

IM­MUTABLE SYS­TEM

Se­cu­rity has al­ways been a con­cern in the world of in­ter­net pay­ment, but ex­perts like Leon­hard Weese, founder of the Bit­coin As­so­ci­a­tion of Hong Kong, feel that it’s the con­ven­tional bank­ing sys­tem that is in­se­cure.

“Credit cards are a bit of a mess from a se­cu­rity per­spec­tive,” says Weese. “All the in­for­ma­tion you need to spend on a credit card is writ­ten on the card. Any­one who ob­serves it can use it.”

The break­through of blockchain comes down to “trust­less-ness”, ac­cord­ing to Clif­ford Choi, tech­ni­cal ad­vi­sor at Emurgo, a blockchain ven­ture fund and in­cu­ba­tor. “You don’t own the data you give to Facebook,” says Choi, “you just have to trust them with it if you want to use their ser­vices. It’s the same for the money in your bank ac­count, though most peo­ple don’t read the fine print.”

With a cur­rency on a de­cen­tralised blockchain, such as Bit­coin, there’s no need for trust in an in­sti­tu­tion – what the ledger shows is yours and you can store and spend it with­out the need for a bank.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.