Issue link: https://maltatoday.uberflip.com/i/920426
maltatoday SUNDAY 31 DECEMBER 2017 News 13 One of the European leaders in the use of Blockchain technology is Estonia. Citizens there are given a cryptographically secure digital identity card which uses Block- chain technology, giving them ac- cess to public services. The coun- try wants to go a step further and try use a Blockchain system to maintain the country's one million health records. But not everyone is as enthusi- astic about Blockchain as the Mal- tese Government and doubts nip at Blockchain's heels. As the power behind a fundamental shift in how the internet is used, Blockchain promises to usher in a new glob- al economy of immediate value transfer, where big intermediaries no longer play a major role. The downside to all this is that it will also potentially disrupt hundreds of intermediary-reliant industries and lead to job losses. So while it's great that the technical aspect has been perfected, we mustn't forget to plan for the social impact of this new paradigm. Bitcoin mining Blockchain has also created an unexpected environmental threat: Bitcoin mining. The ma- jority of this activity is carried out in China and requires enormous amounts of computing power. According to some estimates, Bitcoin's electricity demand is equal to three million US homes. Additionally, the number of Bitcoins in circulation – which is currently approaching 17 million – is supposed to max out at 21 million. As this limit is approached, the coin-cre- ating algorithms are designed to get more difficult to solve, meaning that more computing power is required and there- fore more carbon is generated. The majority of Chinese elec- tricity comes from burning coal, which makes this technology harmful to the environment. Bitcoin is a cryptocurrency that uses Blockchain technology. It traces its origins to a 2008 paper written by the mysterious Satoshi Nakamoto - a pseudonym for an individual that nobody has been able to trace. The semi-official definition of cryptocurrency is "a peer- to-peer, decentralised, digital currency whose implementation relies on the principles of cryptography to validate the transactions and generation of the currency itself." Conceptually, Blockchain technology is just a new way of maintaining ledgers. Imagine that a bank maintained a single ledger listing all its customers, their accounts and the corresponding balances. Every time a customer wants to pay someone, they notify the bank, who updates the ledger by subtracting currency from one account and adding them to another. The big difference between Blockchain technology and existing methods is that in the Blockchain, this ledger is not maintained centrally by one authority, but by many people instead. Let us call the people who participate in maintaining the ledger, peers. Each peer has their copy of the document with the full ledger, which includes all owners, their accounts and the corresponding balance. There is no longer one single paper document on which the true ledger is written, every peer owns a copy. With every transaction, all peers would have to update their ledger copy because every peer should have the same information. But in order to ensure that all the peers have the same ledger, they would need to meet and agree to update the ledger, before signing each other's document. If this sounds like a nightmare of brain- rending tedium, that's because it probably would be - had it not been for Blockchain technology. EXPLAINER Bitcoin