What is blockchain and how can I get a job in it?

Keen readers of this blog will have already spotted our 4 financial sectors set to boom post published last month. In that post we identified cryptocurrencies and ICO (initial coin offering) as a key area tipped for growth in 2017.

And that’s all very well, but without blockchain we’d have no cryptocurrencies and no ICOs in the first place. Because, as Sally Davies, Technology Reporter for the FT puts it: “Blockchain is to Bitcoin, what the internet is to email”.

In other words, blockchain technology is essentially a huge electronic system used as the platform to build applications on – currency being just one of those applications.

So what does that mean for jobs in finance? Well, for starters, the market is growing fast. Some experts predict it to be worth $20bn by 2024 – not bad given that it didn’t even exist before 199, and its first practical implementation was less than a decade ago.

Blockchain beyond Bitcoin

René Bader is Manager of Critical Business Applications & Big Data at NTT Security. He says that while Bitcoin is probably the mostly widely known application to use blockchain technology, other sectors like banking, insurance and the music industry could soon be using it.

“Blockchain enables transactions in a peer-to-peer network to be validated without the need for an intermediary, thus ensuring traceability and transparency,” explains René.

“It is currently under careful consideration for adoption in the banking sector. It could be used for billing and transferring assets by documenting transactions without the need for validation from a central office, which will reduce costs and speed up processes.”

As for insurance, René says that it’s possible to dynamically adapt insurance conditions in the blockchain based on the habits of the policyholder, before adjusting the premium payment accordingly.

Smart contracts

Dr Joao Ferreira is a cybersecurity expert at Teesside University. He also cites banking as a key area for blockchain, particularly smart contracts.

“A promising direction is the combination of blockchain technology with the concept of smart contracts, since it enables the automated execution and fulfilment of contract terms and conditions,” says Joao.

“Smart contracts are essentially computer programs that represent the logic of contractual clauses. Because they are written for computers to understand, natural language ambiguities often present in conventional contracts are removed. Because they are stored in the blockchain, they are transparent and trustworthy.”

As a result, the financial services industry seems to be shifting towards the adoption of smart contracts believes Joao.

A fresh start

Marieke Flament is MD for Europe at Circle, a peer-to-peer payment app that uses blockchain to power its smart contracts. She believes that blockchain – irrespective of its uses – has encouraged a shake-up of the market.

“Blockchain technology has given financial institutions an opportunity to take a fresh look at how core infrastructure, designed decades ago, could be redesigned. Even if blockchain technology isn’t ultimately involved in the resulting overhaul, it got people in the room and fuelled the conversation,” says Marieke.

As well as finance, she cites IoT, healthcare and supply chain management as key areas that she expects to see benefit from the technology. And as for working in blockchain: “Get involved!” says the MD. “The barrier to entry is extremely low because most of these technologies are open source and freely downloadable. All you need is a laptop, an internet connection and a place to start.

“Educate yourself, either by taking classes or using resources online and then start running your own blockchain node and experiment with the technology!”

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