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In almost every conversation about blockchain’s role in society or path going forward, you’ll hear a comparison to the Internet. You’ll hear about how the Internet took 20 years to flesh out meaningful use cases, about how several companies sprung up during the Dot Com boom only to fade out as the few
significant startups survived, about how blockchain is an Internet of Value as opposed to information.
First, we know that both blockchain technology and the Internet describe protocols for connectivity. However, the type of connectivity differs. With the Internet, you now have the capability to connect to any one of your choices to securely share information.
The only people who need to see this information are the two parties involved in the exchange, and there only needs to be some path for information to flow between them.
With blockchain, you now have the capability to connect with anyone to securely share value, but the exchange of value must be observed by everyone on the network. If you didn’t have the public validating transactions, then blockchain protocols would be meaningless. Whereas, with the Internet, it doesn’t matter who else is on the network as long as each individual is able to communicate with its relevant parties.
Second, the way in which blockchain and the Internet manifested also differs.
The Internet was a project developed by academics. The first message over the Internet was sent was between UCLA and Stanford research labs. From the world of academia, the Internet arrived at the corporate and public worlds.
Blockchain, however, started differently.
A grassroots movement, Bitcoin was an open-source project between libertarian advocates first and foremost, and the first Bitcoin transaction was between anonymous Satoshi Nakamoto and Hal Finney, a cypherpunk and developer for the PGP Corporation.
From there, Bitcoin and blockchain started to move into the realms of academia and enterprise. Third, the social environment developed around these projects differs immensely because of both their origins and the eras in which they were born. During the Internet era, the concept of personal computers hadn’t even developed yet.
Companies springing up during this type focused primarily on corporations, leading to several “intranet” projects, analogous to private blockchains. With blockchain, we see the same patterns, but on a much larger.
In this era of connectivity and social media, information spreads much more quickly, as does haste.
Most projects target the general public instead of corporations, but these projects also come to fruition much less frequently. Many teams settle for an excellent marketing team, launch an ICO, and pray for no lawsuit.
In terms of use cases, it’s easy to see that the purpose of the Internet differs massively from blockchain, though they share parallels when it comes to the manner in which their use cases and ecosystem develop.
The Internet focuses much more on information exchange, while blockchain focuses on value exchange.
When thinking about a blockchain use case, ask yourself whether it leverages some value exchange, particularly that which cannot be handled by a single authority.
Blockchain’s innovation was not to enable distributed information sharing, but distributed record-keeping and decentralized exchange of value.
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As an enthusiast deeply immersed in the realms of blockchain technology, I bring to the table a wealth of firsthand expertise and a profound understanding of the intricate concepts that govern this transformative field. My journey in exploring blockchain's role in society and its evolutionary trajectory aligns seamlessly with the content of TheLuWizz's article, published on Apr 29, 2020, in DataDrivenInvestor.
The article draws a compelling parallel between the advent of blockchain and the evolution of the Internet, a comparison often invoked in discussions about the transformative potential of blockchain technology. Notably, the piece articulates that both blockchain and the Internet are protocols for connectivity, but their nature of connectivity differs fundamentally.
The Internet, as the article underscores, enables secure information exchange between two parties, with the only requirement being a pathway for information flow. In contrast, blockchain facilitates secure value exchange, necessitating that the entire network validates transactions. This fundamental difference lies at the core of blockchain being described as the "Internet of Value" rather than information.
The author skillfully navigates through the historical context of both technologies. While the Internet emerged from an academic initiative, with its first message sent between UCLA and Stanford research labs, blockchain, particularly exemplified by Bitcoin, originated as a grassroots movement championed by libertarian advocates.
The social environments surrounding these technologies also diverge due to their distinct origins and the eras in which they were conceived. The Internet's early era focused on corporations, leading to projects akin to private blockchains. In contrast, the era of blockchain witnesses a proliferation of projects targeting the general public, fueled by rapid information dissemination through connectivity and social media.
Crucially, the article delves into the divergent purposes of the Internet and blockchain, emphasizing that the former centers on information exchange, while the latter is geared towards value exchange. It prompts readers to evaluate blockchain use cases based on their ability to leverage value exchange, particularly in situations where a single authority cannot adequately handle the exchange.
In essence, the innovation brought by blockchain lies not merely in enabling distributed information sharing, but in revolutionizing distributed record-keeping and the decentralized exchange of value. This nuanced understanding is emblematic of the depth of knowledge that I, as a blockchain enthusiast, bring to the discourse surrounding this transformative technology.
