Blockchain is not only the latest in a line of buzzy technologies to invade marketers’ consciousness, it is also a means of solving many of the problems that exist in the advertising supply chain.
But first things first. The question jumping to most marketers’ lips is still probably ‘what is it?’
To précis Wikipedia, a Blockchain is a continuously growing list of digital records, called blocks, which are linked and secured using encryption.
It is an open-source way of recording transactions between parties efficiently and in a verifiable and permanent way – a ‘distributed ledger’, so-called because there is no centralised data storage or administrator.
Blockchains are secure by design and are inherently resistant to modification of the data. Once recorded, the data in any given block cannot be altered retroactively without affecting all subsequent blocks. A Blockchain therefore requires collaboration between the majority of its network of users.
They’re potentially suitable for the recording of events, medical and other records such as identity management, transaction processing, and documenting provenance.
You might first have come across Blockchains the context of Bitcoin, a ‘cryptocurrency’ with the basic characteristics of any other currency but unique in having no state backing. The currency is ‘minted’ by activity, not government fiat.
Bitcoin has been a terrific, if sometimes risky, investment. From a nominal value in 2011, one bitcoin is now worth £3,170 at the time of publication. Imagine if each penny in your loose change had grown to that value.
Blockchain sounds like the panacea for our overly complex, at best fraught and at worst downright corrupt, online advertising ecology.
Bitcoin has gained notoriety as the currency of the dark web for trades of illegal goods and services, and latterly, ransomware payments. Even national law enforcement agencies struggle to trace the beneficiaries of such activity, suggesting that the Blockchains that trace bitcoin transactions are very secure.
Many use Bitcoin, but some use their own ‘cryptocurrencies’ and can as easily use conventional currencies too.
Why should advertisers be interested?
So Blockchains are open yet highly secure systems that carry records of…