Building blockchains in energy markets

The idea of using blockchain technology to ease trading in the energy and commodities markets is cropping up more and more. Famously, blockchain is the technology behind cryptocurrency Bitcoin. Blockchains can be public, as with Bitcoin, or private, such as a group of traders. The individual participant receives an online wallet that can be charged up with a digital currency. The individual can then transact with other members registered to the blockchain. The blockchain’s network of registered computers continually validate transactions, building blocks of transactions that are then permanently entered in the ledger. Nobody can change the ledger; it is immutable. It is shared with all members at all times. It is not stored in one central place, reducing the risk of cybercrime. Since transactions are cleared instantaneously using the chosen digital currency, there is no settlement risk. Companies in a variety of sectors, such as finance, see huge potential in blockchain technology. Energy firms are no different. The technology is now being put to work in a variety of experimental applications, both large and small. One example is the Brooklyn Microgrid, a local peer-to-peer energy market that began in April 2016. The microgrid allows a small number of consumers

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