Blockchain Technologies and Cyber Currencies
The use of blockchain technologies and cyber currencies is likely to change the way we undertake and securely record transactions on digital ledgers that can’t be tampered with. These can be used to record and track the ownership those assets over time, execute contracts, transfer ownership rights and obligations, and make payments, to name a few of the potential applications.
Technology has woven our world together. The number of international air passengers rose from 75 million in 1970 to an estimated 3.7 billion in 2016.55 The cost of a 3-minute phone call from the United States to England dropped from more than $8 in 1976 to less than $0.06 in 2014 when VoIP (voice over Internet protocol) is used for a call to a landline or cell phone. When both the sender and receiver have the appropriate software (e.g., Skype, WhatsApp) then the cost goes to 0. The number of transborder calls in the United States was 200 million in 1980.
Estimates of the numbers today are in the tens of billions. VoIP has disrupted traditional long-distance telephone markets dramatically, and the proliferation of alternative communication channels, including SMS texting, BBM (Blackberry Messenger), Facebook, and their equivalents on other platforms have transformed the communication landscape. The number of cell phones in use totaled 6.8 billion in 2013, meaning one for almost every person alive.57 In 2017, there were an estimated 2.32 billion smartphone users, meaning access to digital information and apps for everything from weather forecasts to online purchasing and the transfer of funds. Even those without access to a bank or smartphone can transfer cash safely and securely on a regular cell phone in some developing parts of the world—Google “M- Pesa” for an example of this.
Our embrace of digital technology and connectedness has opened the world to us and made it incredibly accessible, but it has come with costs. Security concerns related to viruses and hacking have also escalated, and serious breaches are a common occurrence. The Ponemon Institute estimates that in the United States alone, 110 million adults had their personal information exposed by hackers during a 12-month period in 2013. In September 2018 Facebook reported that 50 million of its accounts
were directly affected by a hack.59 The cost to firms responding to these threats and breaches are in the billions, and that doesn’t include the damage done to customer trust and loyalty. Costs related to online fraud and identity theft are in the billions (some put the estimates in excess of $100 billion) and growing rapidly. These issues will not go away any time soon.60 Issues related to the loss of privacy, industrial espionage, and sabotage involving both firms and government agencies have also become common.61 On a business-to-business level, supply chains woven together through software allows them to operate effectively and efficiently, while at the same time opening them to risks.