It runs on block chain. A database that writes transactions across distributed network. The digital ledger is sequentially written, transparent and uses hashtags to ensures validity. If someone tampers with the chain, future transactions will not be accurate for all to see.
Who discovered this technology? Some guy, not sure. He wrote a white paper, helped out a bit, then disappeared. Seems odd. Digital currency entered the scene Jan 2009, after the financial meltdown.
Block chain is highly valuable due to the fact that it handles secured transactions. The chain doesn't have to be related to money, so the open source code can be used across variety of sectors. Think healthcare, retail, stock market. Transactions are instantaneous, bypassing the traditional wait time like overnight batch processing.
It's primed to replace paper money in the near future. Perhaps another financial collapse, exit paper money, enter digital currency stage left. Electronic currency can be tightly controlled, making fraud and money laundering almost impossible.
Block chain can track assets. Any asset. With the rise of Internet of Things or IoT, products can be tracked using current methodologies, and soon to be tracked using block train.
Let's say you purchase an item on the internet, using a digital currency like Bitcoin. The product is shipped, perhaps tracked in the delivery truck, it arrives at your house. The embedded sensors in the IoT device sends signals back to the home office, write a record to the block chain, "asset ownership="John Q. Owner", DateOfOwnership="2017-09-22", PricePaid="49.99", TaxPaid="3.49". As you can see, the asset is tracked in an IoT Block Chain database, over time, with audit trail.
If asset changes hands, perhaps stolen or bartered, were proper taxes paid, IoT-Block Chain knows.
Once digital currency takes off and potentially replaces paper money, the national deficit could be wiped clean over night. Since the dollar is no longer tied to the gold standard, and potentially no longer secured with paper money, not only can every coin or token be tracked in real time, we could also trace each coin back in time to see how it changed hands, when, by whom, you name it.
Imagine how many companies are tied to paper money. Banks may not be necessary in the future. Also something to note, the entire currency could be centrally located, perhaps across the globe, with a single currency. Asset tracking could become a reality. Transparency. Audit trail. And Centrally controlled. The ramifications of this technology could alter the planet, a real eye opener for sure. Don't take my word for it. Have a watch:
The times, they are a changin'.