2. Blockchain Value
The value of blockchain technology can be presented in five ways: its definition, application scenarios, the nature of finance, how value is generated, and its integration with AI.
1. What is blockchain
Blockchain is a chained data structure, which forms a data chain by connecting data in blocks in chronological order. These blocks of data are encrypted through cryptographic techniques, thus guaranteeing the data’s immutability and unforgeability. In short, a blockchain is a decentralized distributed ledger where data is distributed and stored on computers across the globe, with each computer keeping a copy of the data, thus ensuring data security. The data in a blockchain is encrypted by a hash function so that it cannot be easily cracked, thus increasing security.
Each block contains a set of data and forms a chain structure by connecting it to the previous block. This structure avoids the risk of a single node failing or being tampered with. The decentralized nature of blockchain makes it highly trustworthy as it does not depend on any central administrator and anyone can join or leave the network.
2. Application Scenarios of Blockchain
The applications of blockchain cover almost all fields, including but not limited to: finance, supply chain management, digital identity, heritage management, logistics tracking, NFT, IoT, and so on. Because it has the characteristics of decentralization and data immutability, blockchain can be applied in any scenario where data needs to be stored and managed. Taking finance as an example, blockchain can be used for cross-border payments, decentralized finance (DeFi), asset tokenization, and so on. Its transparent and de-trusted nature allows blockchain to provide more secure and efficient solutions for various industries.
The application scenarios of blockchain are expanding and may be integrated into every aspect of life in the future as the technology develops. For example, we now generate a huge amount of data every day, and traditional internet platforms such as YouTube and Google need to process and store this massive amount of data. Blockchain provides a decentralized solution for storing this data and may become the storage infrastructure of the future.
3. The nature of finance
The essence of finance is the exchange of value across time. We spend future value up front by borrowing or paying for it. For example, when you borrow money, you are actually exchanging future income for the money you need today. This exchange of value is not limited to money, but also includes other forms of asset exchange.
And the essence of blockchain is also value exchange, which it achieves through a decentralized ledger and consensus mechanism. In Bitcoin, for example, miners keep track of the ledger by processing transactions, and the miner’s income is an exchange of value for his or her work. Similarly, in Ether, users compete for block priority by paying a Gas fee, and the process is an exchange of value.
At the heart of value exchange, both in finance and in blockchain, is the payment of a price to obtain a desired resource. Every transaction and every data storage in the blockchain is driven by certain economic incentives to ensure the operation of the system and the security of the data.
4. Generation of Blockchain Value
The value of blockchain is not apparent at the beginning, it is gradually formed under specific applications and scenarios. When we use blockchain technology to conduct transactions, store data, or provide services, transaction fees and storage fees are incurred. For example, in a decentralized storage network, users pay a certain amount of tokens for storing data, and this fee forms the value of the blockchain. Then in the DeFi application, users pay Gas fees to get priority for block confirmation, and these fees also become the value of the blockchain.
In addition, the value of blockchain also stems from its ability to ensure data security and transparency. In a decentralized network, no party can unilaterally modify the data, and this mechanism of trust makes blockchain technology highly reliable.
5. Combination of Blockchain and AI
Artificial Intelligence (AI) is another current hotspot in technology and the combination of blockchain and AI will have huge potential.AI applications usually require large amounts of data which needs to be stored and managed efficiently. Blockchain’s decentralized storage and data immutability provide reliable infrastructure support for AI. In the future, blockchain may not only be used for data storage of AI models, but may also play an important role in data privacy protection and collaboration.AI agent is building a new era, and blockchain will become the foundation of the whole AI.
In some scenarios, AI agents could be deployed in blockchain networks to analyze and make decisions about data through smart contracts and decentralization. This combination could change our understanding of data privacy, data sharing and AI.
Conclusion
The value of blockchain does not come solely from its technology itself, but from the transformations it can bring to a wide range of industries. Whether it’s finance, storage or decentralized applications, blockchain offers a new way to manage and exchange data. And in the future, as technology continues to advance, the combination of blockchain and AI may bring us even smarter and more efficient solutions.
The value of blockchain technology continues to evolve, and the changes and innovations it brings will play an important role in the digital economy of the future.