9 Facts You Didn't Know About Blockchain

5/6/2018 9 Facts You Didn't Know About Blockchain
9 Facts You Didn't Know About

Blockchain
It's already improving scientific research, it's likely to revolutionize the
shipping industry, and it could be used to digitally identify billions of
people.
Chris Neiger (TMFNewsie)
May 5, 2018 at 11:45AM
Blockchain has gotten a lot of attention as the foundation for cryptocurrency transactions, but the
technology has many uses beyond keeping a record of who's exchanged bitcoins with whom.
Blockchain is, at its simplest, an open ledger that isn't owned by anyone. It's a technology that is
used to make financial transactions, sure, but its decentralized nature means that people,
businesses, and governments can use it for recording all sorts of information exchanges.
Here are just a few of the most important things you should know about this transformational
technology.
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1. It can be used to assess scientific research claims.

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A recent Scientific American blog post says that about 2.5 million scientific studies are published
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every year, but researchers have a difficult time authenticating the results. In fact, over two-thirds
of scientists who try to replicate another researcher's results fail to do so. But blockchain could
help with that, says the article: "Blockchain would make sharing, authenticating, and certifying
information much faster and easier -- and render it nearly impossible to alter data."
2. Blockchain technology has managed and distributed more than $270 billion in
transactions.
Research from Gartner says that 300 million blockchain transactions were processed through
the end of 2017.
3. Blockchain's market size will be $60 billion by 2024.

Blockchain's market size was just $708 million in 2017, but it's expected to skyrocket to $60.7
billion by 2024. Most of the growth over the next few years will likely come from the financial-
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services space.
4. Some tech companies are making money from the trend, but they remain cautious.
NVIDIA Corporation (NASDAQ:NVDA) and Advanced Micro Devices (NASDAQ:AMD) sell
their graphics processing units (GPUs) to companies and individuals who use them to mine
cryptocurrencies, like bitcoin. But the processors can also be used for blockchain ledgers.
NVIDIA's CEO Jensen Huang recently said in a CNBC interview that "[b]lockchain's going to be
here for a long time and it's going to be a fundamental new form of computing." He added that
blockchain and cryptocurrencies will both be important drivers for GPUs.
NVIDIA doesn't break out its GPU sales for blockchain specifically, but it did say that in its third
quarter of fiscal 2018, it made $70 million from GPU sales for cryptocurrency mining. Of course,
blockchain and cryptocurrency mining aren't the same things, although they're related, so it's
difficult to nail down just how important blockchain is to NVIDIA right now. But what we do know
is that the company isn't betting its future on either trend. NVIDIA's CFO Colette Kress said on
the company's recent earnings call: "While the overall contribution of cryptocurrency to our
business remains difficult to quantify, we believe it was a higher percentage of revenue than the
prior quarter. That said, our main focus remains on our core gaming market, as cryptocurrency
trends will likely remain volatile."
Similarly, AMD is benefiting from blockchain, but it still represents a small portion of the
company's total sales. The company recently said in a statement that the percentage of revenue
related to blockchain was in the mid-single digits for 2017. It added: "We appreciate the time and
attention that investors continue to pay to Blockchain and cryptocurrency, but would also like to
keep it in perspective with the multiple other growth opportunities ahead for AMD."
5. It's being used to add transparency to media-buying.

Salon Media Group is testing a blockchain ledger created by International Business
Machines (NYSE:IBM) to record ad-buying contracts, impression data, and how much Salon will
be paid for the ads. Additionally, Unilever has begun using IBM's blockchain to buy some ads in
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the U.S. and keep track of its transactions. Tech executives rank IBM as one of the top
blockchain companies in 2017, with 43% rating IBM's blockchain tech above all its competitors'
systems, according to Juniper Research.
6. The tech can be used to manage power usage by electric companies.

Blockchain can be used to modernize how electricity consumers share usage information with
their utility providers, by securely and automatically sending their monthly consumption to a
decentralized ledger. An MIT Technology Review article noted last year that energy producers
and consumers could use blockchain to easily share data with each other: "Advocates say the
technology could be especially promising in industries where networks of peers -- electricity
producers and consumers, connected via the grid, for instance -- depend on shared sets of
data."
Some people in Brooklyn, New York, have even begun setting up their own "microgrids" by
generating their own electricity using solar panels and then selling the power to their neighbors
using a blockchain system. That's an extreme example of blockchain's possibilities within the
energy market, but simpler uses involve using the tech to easily and efficiently exchange
metering and billing information with utility providers.
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7. Blockchain adoption could revolutionize the global shipping industry.

It takes a lot of complex logistics among companies using dozens of shipping lanes to move
goods around the world. But the shipping industry is looking to blockchain to simplify this
process by reducing days of paperwork to just minutes. A recent Bloomberg article said that the
tech could be the biggest transformation in shipping since the standardization of container sizes
in the 1960s. If blockchain does indeed make it easier for companies to organize shipping, that
could reduce the cost of goods sold around the world.
8. The U.S. government could use it to manage wireless spectrum.

There's a very limited segment of the airwaves that the U.S. government currently licenses to
commercial broadcasters and amateur operators. Some parts of this spectrum are used for
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things like commercial cellular signals, others are set up for government signals, and others are
used for things like your home Wi-Fi.
Blockchain could be used to manage these airwaves by using the tech to set up multiuse
spectrums based on demand. Companies and individuals would be able to communicate their
spectrum needs through a decentralized blockchain, which could reduce the cost of allocating
spectrum to only certain types of devices and systems, according to Wired. It may seem like an
odd way to use the tech, but it's yet another example of blockchain's versatility.
9. It's being used to create digital IDs for people.

More than 1 billion people in the world have no way to prove their identity, but a Microsoft
(NASDAQ:MSFT) blockchain project wants to change that. The company wants to create
decentralized digital identification, assigning each person a unique identifier that could be used
for banking, health insurance, and even travel.
A few thoughts on the blockchain market

Blockchain is still in its infancy, and there are plenty more ways it can be used. Many companies
are just getting started with their blockchain strategies, but as this trend continues, we're bound
to see companies invest in it much more. While it clearly has lots of potential, I wouldn't make
any investment decisions based solely on blockchain right now. There's still a lot of hype around
the technology, and that sometimes leads investors to buy shares of a company simply because
it dabbles in blockchain.
Instead, I think investors should focus on technology companies that are already leaders in other
markets and have the potential to benefit from blockchain. Ongoing leadership in GPUs for
gaming, AI, and data centers makes NVIDIA a solid bet -- and the company also has a growing
opportunity in blockchain.
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Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool's board of directors; LinkedIn
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shares of and recommends Nvidia. The Motley Fool is short shares of IBM. The Motley Fool recommends
Gartner. The Motley Fool has a disclosure policy.
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AUTHOR
Chris Neiger
(TMFNewsie)
Chris has covered Tech and Telecom companies for The Motley Fool since 2012. Follow him on Twitter for the latest tech stock
coverage.
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ARTICLE INFO
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May 5, 2018 at 11:45AM
Technology and Telecom
STOCKS
Nvidia
NASDAQ:NVDA
$239.06 $6.07 (2.61%)
Microsoft
NASDAQ:MSFT
$95.16 $1.09 (1.16%)
Advanced Mic…
NASDAQ:AMD
$11.28 $0.35 (3.20%)
IBM
NYSE:IBM
$143.91 $1.92 (1.35%)
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5/6/2018 9 Facts You Didn't Know About Blockchain