Blockchain primer notes differences between business use, cryptocurrencies

There is a huge gulf between the emerging blockchain-for-business technology and the cryptocurrency world, a group of 150 Oklahoma business leaders learned at the recent Blockchain for Business conference at the Baker Hughes/GE Energy Innovation Center.

The blockchain primer delivered to the Oklahoma audience by Alan Dickman, IBM Blockchain Architect, contrasted the two computing networks that are often confused for one another.

“Blockchain is really just a shared, distributed ledger that helps record transactions,” Dickman said in his keynote presentation. “Blockchain facilitates business processes that are shared among a network that is using the same ledger.”

What blockchain-for-business is not is a giant, worldwide computing network that requires every member of the network, or peer, to update their blockchain file with each transaction, Dickman said.

“That sounds like Bitcoin, where there are lots and lots of peers around the world, and what you are doing is updating each ledger,” he said. “Only a small number of blockchains have that infrastructure.”

Blockchain-for-business can limit the number of peers, and requires that each participant be identified and invited to the network. Transactions are recorded as an “immutable” record that can never be altered.

In contrast, Cryptocurrency networks are known as “permission-less,” which means that participation is unlimited. Participants can remain anonymous. The “permission-less” networks can grow unwieldy and consume large amounts of energy as each transaction is updated.

“You can have permission blockchains where you put up your own private networks,” Dickman said. “So, it depends on the use case and depends on the technology and whether you are using a permission or permission-less blockchain.”

The Blockchain for Business conference was presented by OG&E and IBM, with support from the Greater Oklahoma City Chamber; the Oklahoma Department of Commerce; the Oklahoma City Innovation District; the Oklahoma Center for the Advancement of Science and Technology (OCAST); the Tom Love Innovation Hub at the University of Oklahoma; Baker Hughes, a GE Company; the Oklahoma Manufacturing Alliance; Zilker Technology LLC.; and the Energy Web Foundation.

“From OG&E’s perspective, the business purpose of this conference was two-fold,” said Richard Cornelison, economic development manager for OG&E. “We wanted to bring a better understanding of technology and ways to communicate to the communities we serve and into the companies we serve.”

The conference featured breakout sessions for energy industry users, government, health care and supply chain and oil and gas.

“Blockchain is one of those emerging, potentially enabling technologies that has the capability of impacting our economy,” said Mark Ballard, programs officer with OCAST. “We’re interested in this technology because it can give businesses another opportunity to compete more effectively in the economy.”

Jim Stafford writes about Oklahoma innovation and research and development topics on behalf of the Oklahoma Center for the Advancement of Science & Technology (OCAST).