5G for Blockchain Technology
Will 5G-Powered Wireless Internet Help Boost Blockchain Distributed Ledger Technology Functionality?
The first nut to crack open is asking: “what can 5G do for blockchain?”, or, is it: “what can blockchain do for 5G?”.
5G will push many industries forward, but it could have a particularly big impact on blockchain. Experts believe that the combination of 5G and blockchain distributed ledger technology will lead to significant benefits around the world.
5G will make communications technology cheaper and faster for the developing world. 5G could fuel a surge in micro-payments technology, like cryptocurrencies, as more people adopt smartphones. In the developed world, meanwhile, 5G could lead to the rise of artificial intelligence, augmented reality, and smart devices, making our world more advanced than ever.
Qualcomm President Cristiano Amon expects 2020 is the year 5G goes mainstream. He expects 5G to spread throughout major metropolitan areas in 2020, then expand into developing countries in 2021. Amon also expects phone companies to ship over 200 million 5G smartphones by next year.
As 5G communication technology expands worldwide, it could also fuel the rise of distributed ledger technologies (DLTs) and blockchain. In fact, 5G could be the biggest thing to ever happen to blockchain, cryptocurrencies, and distributed ledger technology.
As greater connectivity and a possible 100X faster internet latency potential, 5G is estimated to take today's lag effect of 100ms and churn it down into a chiseled 1ms. At a one hundred times multiple, not to mention billions more users around the world coming online at high speed bandwidths for the very first time, blockchain as a cadaster will only become more alive and well as more become plugged into the 5G-powered internet 2.0 web that could be utilizing a blockchain-based codebase that is of course, decentralized and peer to peer at its core. Not to mention the additional caveats of having no third-party involvement, operates trustless, adds fraud protection and detection, transparent yet secure, and of course – making digital money scarce.
In a 2020-led soon-to-be-profound decade, amid global uncertainty of the existing financial structures, wealth is knowledge and most growth is in unexpected bets. In a world where economies can seemingly change as fast as someone's mind can change, time has to be the source of all measurement. If money were to be the measuring stick, it must be based on time.
‘Money' is tokenized time.
Blockchain gives money the opportunity to be open ‘are we decentralized yet', forward-facing network where the world can chip in and contribute to a time-tested system set in stone from day one. 5G, despite all of its controversy and even peak conspiracy theory momentum, will undoubtedly be a vast global enabler of so many emerging technologies and communication networks.
Many community researchers say 4G was essentially a flop since it was rolled out in 2009, even compared to the advancements 3G brought to the economy handful of years prior. The same insights project 5G to quite literally be 100X faster than 4G. As satellite internet and highly-connected broadband WiFi speeds accelerate into the 2020s, blockchain could be one of the biggest beneficiaries of this fifth generation wireless cellular network.
Bitcoin has been surviving the spectrum of finance since its release in 2009. As the public BTC ledger winds down into its third block reward halving cycle that was coded into its open-source software DNA code, Bitcoin will be 4,147 days old come May 12, 2020 when the event is set to take place. But what will 5G do for bitcoin's well-being and the blockchain ecosystem?
Many are calling blockchain the investment of the decade for the genesis technology that it is, has been and will be a formidable force in the future as it is built to endure, persevere and sustain itself like the safe haven bedrock that it is. Now, a higher-powered internet reboot is forming and this time between the combination of blockchain, artificial intelligence, internet of things, robotics, self-driving electric cars and other upcoming possibilities; all of these industries stand to gain in efficiency due to greater connectivity, higher capacity and reduced latency from 5G mobile network technology.
Let's explore why 5G is a catalyst for blockchain technology and how fifth generation WiFi can enhance publicly distributed ledgers around the world. Will 5G help blockchain-based cryptoasset network's payments, fees, and security infrastructure and connectivity?
5G Will Make Crypto More Accessible for Developing Countries
Most people in the developed world use smartphones. That’s not the case in developing countries. Only about 24% of people in India and 50% of people in Brazil use smartphones, for example. The rest rely on feature phones or “dumb phones”. These people have been left out of the crypto revolution, mobile banking, and all other smartphone apps.
In developing countries, more people have access to a phone than they do to electricity. For many, the phone is their only major electronic device, they don’t own a computer or laptop, for example.
When 5G enters the developing world, it will make smartphones cheaper and more accessible than ever.
The Developing World Has Strong Demand for Mobile Payment Solutions
We’ve already seen a trial run: as pointed out by CoinTelegraph, mobile payment company M-Pesa has gone from an unknown app to a ubiquitous force in Kenya.
Launched in 2007, M-Pesa is a mobile money transfer service that works with smartphones and feature phones (dumb phones). About 96% of households in Kenya have at least one M-Pesa user. Even households living in extreme poverty can access M-Pesa.
M-Pesa has helped many Kenyans living in extreme poverty move above the property line. In some rural communities, M-Pesa has boosted incomes as much as 30%.
In a 2017 press release, M-Pesa parent Vodafone described it as “the world’s leading mobile money service”. M-Pesa has over 30 million active customers, 614 million transactions per month, and 529 transactions per second.
Why are we telling you about M-Pesa? Because M-Pesa shows there’s demand for good mobile payment technology in the developing world, as long as they can access it with their current technology.
Kenyans haven’t adopted bitcoin, mobile banking apps, or other apps en masse. But they have adopted M-Pesa because it works with their technology. As 5G expands into Kenya in the 2020s, it will make technology, including blockchain or distributed ledger technology, more accessible than ever.
There are nearly two billion unbanked people worldwide. 5G is inevitably spreading to all of these people.
5G and Blockchain Could Lead to Secure Mobile Banking
A combination of 5G and blockchain could help banks secure their apps. Banks are already using blockchain for security. Distributed ledger technology can authorize transactions without the need for a central authority. Even if the central authority, like the bank’s server, is compromised, the network can still process transactions.
5G and blockchain could combine to make this system even more effective. Richard Dennis, founder and CEO of cryptocurrency company TemTum explains,
How Will 5G Benefit Blockchain and Crypto Users?
Mobile communication providers expect 5G to offer all of the following benefits:
- Reduced latency
- High data rates
- Energy savings
- Cost reduction
- Higher system capacity
- Massive device connectivity
All of these benefits could benefit blockchain and cryptocurrency. Overnight, mobile communication becomes cheaper and easier with 5G. 5G is also expected to fuel smart devices or IoT devices. By reducing latency and improving speeds, 5G makes IoT devices more accessible.
IoT devices could boost blockchain even further. These devices can leverage key blockchain features; like security, decentralization, immunity, and consensus arbitration as foundational layers. That means the smart cities, driverless vehicles, and smart homes of the future could rely on 5G fuelled blockchain.
Blockchain technology requires lots of network capacity. 5G provides that network capacity, making blockchains a more feasible solution worldwide. That higher network capacity could shorten block times, making it easier for blockchains to scale. 5G can also assist blockchains by boosting node participation and decentralization.
5G Could Revolutionize Blockchain Scalability
Many of 5G’s blockchain improvements come down to scalability. That’s huge: to date, blockchain’s biggest issue has been scalability. Blockchain is ultra-secure and reliable, but it’s not always scalable.
Bitcoin’s 3.8 transactions per second (tps) cannot compete with the 5,000 tps of MasterCard and Visa, for example. Other cryptocurrencies have offered faster solutions, yet bitcoin remains the king of crypto. 5G offers speeds of up to 10 gigabits per second. It will improve the speed of cellular networks and home broadband.
5G could eliminate bottlenecks. It could improve capacity and speeds while reducing latency. It makes blockchain more scalable overnight by increasing node participation and shortening block times. In short, 5G could make it easier than ever to organize a decentralized, global network of blockchain nodes.
5G Could Empower Smart Contracts
5G could also make smart contracts more usable than ever. Smart contracts rely on oracles, which are external data feeds that relay information to the smart contract. The oracles need internet access to send data. As 5G expands worldwide, it will make it easier for oracles to send this data, especially in remote areas where this would otherwise not be possible.
5G Will Improve Blockchain Networks by Increasing Node Participation\
5G will deliver massive increases in range and bandwidth while also reducing latency. That means more nodes could join public blockchains. And, by extending coverage in remote areas and improving connectivity for mobile and tablets, there could be increased network participation. More participation means more nodes. More nodes means more security and better decentralization.
Many criticize bitcoin for having the majority of nodes based in China. It gives miners in China some influence over the network. 5G could eliminate this issue, making it easier for blockchain networks to diversify networks worldwide.
Cisco Has Won a 5G Blockchain Patent
It’s no secret that blockchain and 5G could work together for huge benefits. In November 2019, network technology giant Cisco received a patent explaining how it could leverage blockchain to secure data in 5G telecommunication networks.
The San Jose, California-based company submitted the patent all the way back in June 2018. Cisco will use the platform to manage data sessions between an equipment user, like a phone or a laptop, and a virtual network.
In other words, Cisco’s patent will manage data exchanges between a network and a connection device via a blockchain. Clearly, Cisco sees potential in 5G and blockchain, believing the two technologies can work together to push us forward.
Could 5G Hurt Blockchain?
We’ve listed many reasons above why 5G could benefit blockchain. However, is there any evidence that 5G could hurt blockchain? As with any new technology, there are some potential downsides.
Malicious devices could cause chaos within networks, for example. Fueled by interconnectivity, malicious devices could wreak havoc on unsecured networks. Or, 5G could lead to an explosion of people using cryptocurrencies and blockchains but blockchains may not scale to keep up. There could be surging demand on the same aging infrastructure, which could push users even further away.