After The Social Web, Here Comes The Trust Web

Editors note:David Cohen is the founder and Managing Partner of Techstars, the #1 ranked Internet startup accelerator in the world. William Mougayar is an entrepreneur turned angel investor, founder of Startup Management, and currently raising his first fund.

You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.- Buckminster Fuller

The bitcoin train is really made up of two revolutions in one: money and finance, based on the bitcoin protocol, and exploiting the currency programmability aspects; and decentralized applications, based on the blockchains distributed technology capabilities.

Both are grounded in similar roots (crypto-technology), but they have different branching. Both paths are creating disruptive, innovative and system-changing opportunities for startups, investors, consumers and business players. Both are joined at the hip, and that hip is the blockchain, the backbone of crypto-based transactions.

To fully understand the blockchain concept and the benefits of cryptography in computer science, we need to first understand the concept of decentralized consensus, a key tenet of the crypto-based computing revolution.

Decentralized consensus breaks the old paradigm of centralized consensus, i.e. when one central database used to rule transaction validity. A decentralized scheme (which the bitcoin protocol is based on) transfers authority andtrust to a decentralized network and enables its nodes to continuously and sequentially record their transactions on a public block, creating a unique chain the blockchain. Cryptography (via hash codes) is used to secure the authentication of the transaction source and removes the need for a central intermediary. The combination of cryptography and blockchain technology together ensures there is never a duplicate recording of the same transaction.

This degree of unbundling is enabling a new way of writing software, and it is a spark of innovation for money- and non-money-related decentralized applications.

There are different flavors of crypto-technology-related implementations. Some are based on the bitcoin blockchain itself and others on an independent decentralized one. Some are based on the bitcoin currency and others on alternative cryptocurrencies or branded tokens. All these various permutations are creating a rich ecosystem environment for cryptocurrency-based innovations.

To say that bitcoin and its sole blockchain hold a monopoly on the future of cryptocurrency-based implementations is like saying in 2006 that LinkedIn was the onlysocialnetwork needed when it was barely leading, and when Facebook, Twitter and many othersocialplatforms were still babies.

We need to view what is happening today as a rich ecosystem that represents the best blend of computer and cryptography science, and not just as an ecosystem of bitcoin-centric technologies.

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After The Social Web, Here Comes The Trust Web