The uses for blockchain technology have grown substantially over the past several years. While once being associated with “niche” products like Bitcoin, blockchain is quickly becoming one of the most widely accepted and secure methods of conducting transactions. Mastercard announced last month, releasing this video, that they are launching their own blockchain technology for certain authorized users (e.g. merchants, developers, and financial institutions). Their focus when developing this technology was speed, transparency, and decreasing the costs associated with business-to-business transactions.
Ricardo Sota, manager at Payments Innovation Mastercard Labs, explains in the video that Mastercard’s blockchain technology acts as an opaque ledger and is a permission-based blockchain. This means that only those involved in a transaction can see the details of the transaction and that a distributed ledger can be maintained without worry about sacrificing performance. One of the outcomes of the technology is that it can be used for clearing card-based transactions in almost real time, nixing the waiting period associated with current technology. For use outside of financial transactions, Sota mentioned that the blockchain technology works for authentication and proof-of-purchase confirmation as well.
According to an article on ZDNet, because Mastercard designed their technology for use in commercial transactions, it has much more room for scalability since the blockchain can be integrated into the company’s payment network of 22,000 financial institutions. This allows users to move transactions both further and faster than before.
Along with this technology announcement, Mastercard noted that they have filed 35 patents specific to blockchain and that they have joined the Enterprise Ethereum Alliance (EEA), an organization that helps develop and explore other uses for blockchain technology. In this alliance, users can mine (or work for) Ether, a cryptocurrency that is used to help fund and run the EEA network.
With more and more large companies joining in on the funding and development of blockchain, it’s going to be interesting to see what the future applications are for this promising technology.