In the 1990s, various works appeared on decentralized solutions for electronic payments, which laid the foundations for the birth of Blockchain technology: public-key cryptography, P2P networks, and timestamps.
Blockchain: The Beginning
The first development of a secure blockchain using cryptography, appeared in 1991, under the authorship of Stuart Haber and W. Scott Stornetta. A year later, they implemented Merkle trees to improve the efficiency of their prototype when working with tamper-proof digital documents. However, the work of Haber and Stornetta was never used, and their patent expired in 2004, four years before the birth of Bitcoin.
This was followed by a chain of developments that sealed the fate of blockchain technology. And so:
- In 1998, Wei Dai described a decentralized electronic payment solution based on open-source cryptography, which laid the foundation for the transfer of digital properties.
- In 2004, computer scientist and crypto activist Hal Finney introduced a system called RPoW, which allowed for the first time the digital transfer of tokens, solving the problem of double spending.
- In 2008, based on the Finney model, Satoshi Nakamoto introduced Bitcoin as part of a P2P system that secures transactions and verifies them in a fully decentralized network, instead of the RPoW system.
Since then, Blockchain technology has evolved to allow a set of scenarios in the form of Ethereum smart contracts for web3 solutions, which we see today on several existing market platforms.
Stages of development of blockchain technology
- Blockchain 1.0
The first successful application of Blockchain can be attributed to 2008, the birth of Bitcoin. it was in 2008, in his “White Paper on Bitcoin”, that Satoshi detailed the details of how blockchain technology contributes to increasing digital trust.
- Blockchain 2.0
Since the advent of Bitcoin, there has been a lot of controversy and denunciations in the community aimed at improving the Bitcoin ecosystem by harnessing the potential of Blockchain technology.
In the absence of consensus, Vitalik Buterin, co-founder of Bitcoin Magazine, and one of the first employees of the Bitcoin network, developed his own version of the Blockchain to execute programmable scripts for certain use cases, in addition to digital payments.
In 2015, it provided Ethereum, a decentralized public network that has become popular today, thanks to DeFi and NFT, hosting millions of transactions and decentralized applications (dApps) used in finance, gaming, education, logistics, healthcare, and many other sectors.
Along with Ethereum, offerings like Zcash, Monero, and DASH were created that focused on improving the privacy constraint and scalability of Bitcoin.
Chronologically, this period of the blockchain is placed in parallel with the birth of Bitcoin “2008”, and its competitor Ethereum “2015”.
- Blockchain 3.0
The history of Blockchain technology is not limited to cryptocurrencies like Bitcoin and Ethereum, but goes forward with their respective decentralized networks. Due to the scalability problem of these networks, some blockchain applications have emerged, which have raised the mass nature of technologies to a higher level.
This has contributed to the emergence of new blockchain platforms, such as Polkadot, FLETA and NEO, which are seeking to accelerate the development of technology. They came with significant improvements to create decentralized applications with superior performance, to meet the demand that exists today.
It is worth noting that the cases mentioned above include so-called public (open source) blockchains, as well as private or federated ones created by some corporations or associations, such as R3 from Corda and Hyperledger from Linux.
Advantages and disadvantages of blockchain versions
Bitcoin was a precursor to the application of Blockchain technology in all its glory, being the most secure decentralized network in the entire available cryptocurrency ecosystem. However, the limitations inherent in its original basis make it impossible to use it in some useful cases, in addition to a payment system or a means of saving.
For second-generation blockchains like Ethereum, scalability issues have proven to be one of the unresolved aspects that needs to be addressed with ETH 2.0.
It is important to note that the new third-generation platforms will be responsible for maintaining the blockchain boom and increasing its spread.
Issues such as interoperability, scalability, and high transaction costs have been addressed in recent projects such as Polkadot, FLETA, and NEO, which guarantees an improved technological foundation to enable blockchain adoption in any sector required to apply the distributed concept.
For example, thanks to the redesign of blocks, the use of parallel segmentation and its own improved Proof of Formula (PoF) algorithm, a key aspect of interaction between chains has become a reality in an ecosystem such as Fleta. It provides faster transactions in a real-world environment at very low cost compared to first-and second-generation blockchains.
The Future of Blockchain: Metaverse
Because of the pandemic, the number of physical spaces is shrinking, so people are looking for more spaces without restrictions, such as virtual space. Now people meet and spend time together in the virtual world. We call it the “Metaverse”. This means a shared virtual space created by the convergence of actually enhanced physical reality.
The word “Metaverse” first appeared in the 1992 science fiction novel Snow Disaster by Neil Stevenson. These days, it’s no longer a novel, but a whole world on Blockchain technology.
Newzoo, the most reliable and cited source of information and analytics of the gaming market, in its latest report shows that a single “Metaverse” may appear in the gaming sector in 2021, as one of the trends to be considered in this great industry.
However, this applies not only to the gaming industry, but also to any industry. Since Blockchain technology and Metaverse represent one whole, this is an example of how these technologies interact.
The use of NFT (non-exchangeable tokens) in these decentralized spaces allows users to create projects and own their initial capital, in the form of real estate, etc.In addition, it allows them to monetize and receive all the benefits fairly and transparently, thanks to the power of Blockchain technology.
In the Metaverse world, people have an economy, politics, lifestyle, and so on, just like in the real world. However, this requires a place to store all this system data, and that place is the blockchain, which may be the best way to confirm ownership of virtual property, and even create and preserve someone’s identity. Since the data is stored on the blockchain, it cannot be changed or deleted. Everything will be transparent, as users can see and track all the saved data.
As Metaverse uses Blockchain technology, more and more people can interact with each other and play in an honest and transparent virtual world.
Metaverse with gaming platforms
The first of them is Sandbox, which appeared in 2012 as a game based on the Ethereum network, having an extremely positive impact on the crypto community. While it’s not one of a kind, the truth is that it has characteristics that make it unique in its own way.
Users can monetize creations on virtual plots called LAND, as well as allow the exchange of these creations with their own token called SAND within the economy created in the ecosystem.
Decentraland is another great platform that has a natural space in Ethereum, although they recently formed an alliance with Polygon (formerly Matic Network) to address the high gas fees and scalability issues inherent in Ethereum.
As with Sandbox, Decentraland users can monetize their creations and virtual items with their own MANA token, which serves as a medium of exchange within the virtual concurrency created in this metaverse.
Decentraland was the first of its kind in the Blockchain ecosystem and, as such, has one of the largest user bases and creations in the industry. In addition, it conducts live broadcasts using its virtual world due to the pandemic situation, which cannot be held offline today.
In addition to these two projects, there are many games that have Metaverse and Blockchain. And there will be more of them, because these days this symbiosis is becoming more and more popular.”
The future of Blockchain technology looks bright. This is largely due to the significant improvements made to the ecosystem by new players, with a technological base that allows us to meet the growing demand for decentralized applications and the prospects of the metaverse.
It is expected that thanks to the desire of governments and companies to gain the palm in the fight for leadership in this technology, this makes the blockchain in the future one of the most promising and greatest inventions of all time.