API U Series

A Developer’s Guide To Blockchain and Cryptocurrency

Between some astronomical fluctuations in valuation and some very high profile hacks, you’ve probably heard about blockchain and cryptocurrencies on many occasions this past year. Most people first heard about the most popular cryptocurrency -- Bitcoin -- in the context of some form of non-paper currency. Then they learned that there’s more going on; for example that there are other cryptocurrencies beyond Bitcoin (known as alternative coins or “altcoins”) that are similarly considered to be money alternatives. Then, in the course of learning about these cryptocurrencies, people got to know something called blockchain. Blockchain is the technology that underpins Bitcoin and altcoins but is now being used to drive value in other ways.

For decades, technologists have advocated for decentralizing forces that democratize the world through technology (for example, consider the role that social media has played in leveling the world as a playing field). Now, these same technologists like to say that cryptocurrency is such a decentralizing technology that somehow makes people more independent of any corporation, or any government. When first hearing some of these words, you may wonder what they mean (we often find that people preaching decentralization may not fully understand it themselves — they just fell for the hype — although, in the case of cryptocurrencies and blockchain, the opportunity is very real).

Such advocates are the target of many jokes by popular comedians (one favorite comes from John Oliver who gives a hilarious yet technically accurate overview of the cryptocurrency space). Yet despite the noise and the hype, something real is happening here. Thanks to their highly decentralized nature (often referred to as a “distributed ledger”), digital currencies (aka “cryptocurrencies”) could redefine how people use money and much more.

From banks to health services to cat meme-focused games, as new cryptcurrency technologies built on blockchain improve, so too does their potential to disrupt many industries as we know them. For example, Ethereum (a turnkey blockchain platform that’s like a white label-able cryptocurrency) has trended very heavily in the last year. Ripple has a promising, proven, and emerging model in the financial world, gaining adoption among large banks as a faster, more cost-efficient, and more reliable technology for financial transactions.

Hyperledger is a suite of open-source tools to support blockchain development and is governed by the Linux Foundation, the same governing body that oversees the OpenAPI Specification. Often misperceived as a competitor to Ethereum, Hyperledger simply supports a set of tools to help blockchain developers for a variety of purposes. At least one of Hyperledger’s frameworks actually supports the Ethereum platform, while other frameworks help developers to build their own blockchain.

All the while, software engineers who know the space are in demand and those of us who work on APIs all day find ourselves getting called for advice. The author of this series on cryptocurrency and blockchain for developers -- Jeremy Glassenberg -- keeps hearing tidbits about “blockchain” and “decentralization” until he feels like he’s getting hit upside the head. Blockchain startups are reaching out to him for advice on how to run their developer platforms, hoping to apply the technology in various industries.

This is a technical space, and one where several services work together and, similar to other software “stacks,” are layered on top of one another. In other words, the world of cryptocurrency (and blockchain technology), is a space where APIs come up quite a bit. Companies are very curious about blockchain and are asking developers, “Do we need to look into this as a better alternative to a technology that we’re already using?” “Will a blockchain-based startup somehow disrupt us and our industry or will an existing competitor figure out how to unlock an accretive competitive advantage through blockchain?” “How can we use blockchain properly?”

Very few technologies are simultaneously a source of potential and fear the way blockchain is. For this reason, the rush for knowledgeable talent to help companies better understand the pros and cons is on. And quite often, the experts are developers who are intimately familiar with how bytes move through software, networks, databases, and organizations. But like a gold rush, the noise-to-signal ratio is very high. In this ProgrammableWeb series about blockchain and cryptocurrencies, we’re going to break it down for you and, more importantly, shed light on the role played by APIs at each layer of these emergent ecosystems.

This is the beginning of ProgrammableWeb's series on Cryptocurrency and why it matters to developers. In this article we present an overview of the ecosystem including a brief overview of blockchain, Ethereum and more as well as some of the common API types you can expect to see.
Some popular cryptocurrencies serve purposes other than use as a currency, with some acting like a liquid startup equity. This article looks at Ether, the cryptocurrency used by Ethereum, which is meant to be used more as a full-blown cryptocurrency stack and developer platform. Figure 1.
A look at the cryptocurrency market, with all its hype, failed ICOs, and questionable players, reveals an ecosystem comparable to that of the miners in the 1800s. In such an ecosystem, will a market for businesses providing tools and services (such as APIs) to the blockchain world thrive?
ProgrammableWeb's series on cryptocurrency and blockchain technologies aims to give you a sense of the various components and business opportunities within the various cryptocurrency ecosystems. Now, let's take a look at a small handful of typical APIs across those ecosystems.
Ripple provides blockchain payment technologies for banks, giving them more reliability, cost efficiency, and speed (transaction completion and recognition) that are infamous challenges within the banking industry. Its solutions enable banks to handle inter-bank transactions, liquidity and payments.
While often perceived as competitive to Ethereum, HyperLedger operates on a different wavelength. Hyperledger provides a set of agnostic tools for developers who are building blockchain apps, regardless of the core blockchain layer. Therefore it is a suite of the tools mentioned in this article.
Few trends exemplify the idea of FOMO the way blockchain trends do. But should you invest your time or money into it? This article offers some ways that you can get started with blockchain so that you can be aware of a rapidly growing and evolving market and make the best decision for yourself.