A blockchain is a public-key infrastructure (PKI) network. Blockchains use cryptographic signatures to ensure the information sent across the network cannot be changed. Meanwhile, the fees that people pay for transactions pay for servers. The cryptographic layer guarantees that data can’t be altered, while the economic layer ensures that the network will always persist, since if one server fails it will become more profitable for everyone else to operate network nodes, and eventually more people will start up servers.
So why do blockchains matter? Blockchains matter because they are essentially a version of the Internet that is guaranteed to be censorship free, open to anyone to connect with, and still around whenever people need it. Money is the most popular use-case right now, but that is only because existing consensus mechanisms do not scale and developers have been aggressively blocking “spam” applications that try to do anything except exchange tokens from account to account.
With the advent of Saito-class networks, we will see blockchains extend to support a larger variety of use cases where users need to (1) send data across an untrusted public network and (2) know for a fact that their data cannot be intercepted, tampered with, decrypted, altered by a third-party, or changed mid-transmission. What Saito offers is essentially a superior version of the Internet where the tiny fees involved in each message pays for the security needed by that transmission by making sure the network can always survive.
Applications that will use Saito include: financial applications and online payments, certificate registries (distributing security certificates and software patches), DNS systems, decentralized but secure voting systems, and of course social media applications like email and social networks. In practice, we believe that around 80% of most Silicon Valley companies are vulnerable to disruption through blockchain technology, with the remainder likely to use the technology to increase the convenience of user interactions with their services (i.e. application controls for Amazon’s cloud services embedded in secure emails).
There are also a large range of applications such as chat programs, peer-to-peer file sharing services, and content distribution services that can run unproblematically over TCP/IP but that will benefit from the ability of users to exchange IP addresses and encryption keys on a trusted blockchain before kicking down to the unencrypted and slightly cheaper TCP/IP layer for exchanging data securely off-chain.