What is a 'blockchain phone' and how does it work?

HTC plans to release the Exodus this October, and it will be the world's first blockchain phone. We know the project is spearheaded by Phil Chen, the genius behind the HTC Vive, and that blockchain means the phone will have something to do with cryptocurrencies like BitCoin. That's not a lot of information and it fails to answer the two biggest questions: What exactly is a blockchain phone and how does all this work?

There's a lot of "informed speculation" going on around the HTC Exodus. HTC isn't saying much because they need to surprise us come October, and it's hard to know exactly what the company means when they say blockchain phone and describe their vision around it. But we do know what blockchain technology is and how it could be used in a phone.

What is the blockchain?

Don and Alex Tapscott, the authors of Blockchain Revolution (opens in new tab) say:

"The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value."

The keywords here are incorruptible digital ledger because that's what the blockchain is at its core.

A blockchain is essentially a shared database with no master copy.

A blockchain is an encrypted and shared database that's spread across more than one computing device. This means that every person with access can modify that ledger without waiting for someone else to finish any edits. There are complicated algorithms in place to keep duplicate entries out based on the actual time they were created or changed, so the database updates and every client gets the changes and they are always in sync. A blockchain is considered to be secure not because the database is encrypted, but because there is no single "master" copy to edit or corrupt — the blockchain database on your computer is considered to be as valid as the database on any other computer.

With potentially millions of computers hosting the blockchain database, it's also available to the public and verifiable by anyone who has the need and means to verify it. Remember, no matter where the blockchain is accessed, it has the same data because of the software behind it that reconciles any and all entries every 10 minutes. This makes a blockchain a great way to host decentralized data for cryptocurrency. Anyone can access the chain and use software like a currency wallet to spend and manage their alternative currency. Nobody can hack into the chain because there is no master copy to hack.

Blockchain technology is perfect for something like cryptocurrency.

As mentioned, the data is reconciled every 10 minutes. Every change to the data is accounted for, duplicate entries are sorted and separated by the actual time of the transaction, and every copy on every computer is updated. These changes or transactions are called blocks. The group of computers that host the data are called nodes and they form the chain.

The most important thing you need to know when you see anyone talking about the blockchain is:

  • A blockchain is transparent and the data is available to anyone who has software that needs to access it.
  • There is no master copy and as long as enough computers host the data, there would never be a computer powerful enough to find every copy and corrupt it.
  • Any change to the data (such as a BitCoin transaction) happens through a validation system that apps like a coin wallet can interact with. Every node in the chain validates each transaction to ensure that it's valid.
  • A blockchain keeps a record of every transaction (change to a data point) and each transaction holds information about where it originated.

This is why blockchain technology is the right way to keep records for cryptocurrency. It's decentralized — no person or group can manipulate it — and each node acts as an administrator so no single part of the chain can go "rogue" and foul things up. But there are other potential uses for a blockchain. Things like landholder records and title deeds could use a blockchain, or a complete stock market could be built using a blockchain and any middleman such as a broker would become unnecessary. Any type of database that has individual records that need to be assigned to an individual identity could use blockchain technology. Because a blockchain uses public/private encryption key pairing, each transaction is secure and easy to identify.

How will you use blockchain in a phone?

You can already make your phone act as a node in a chain through digital wallets for cryptocurrency, like the Coinbase app.

But let's face it — getting "in to" something like BitCoin or Ethereum is not easy for the beginner. HTC could change that dynamic by including a robust wallet in the phone with a user interface that's friendly and walks you through the process of investing in and using digital currency for everyday transactions. The company also mentions "Trusted Hardware" on the Exodus website so it's possible that there will be an extra layer of security to keep your identity safe as well as your digital wallet.

HTC could have a new and unique way to store your data, but do we really want it?

But it sounds like HTC has a higher set of goals in mind. There's talk of decentralized data for applications and secure on-device storage for your personal information instead of using the cloud. Seeing how HTC plans to secure data in a system that's open to the public, such as a blockchain, is going to be interesting is this is the case.

Depending on just what HTC plans to use blockchain technology to do there is also a chance that the company will have found a new and unique marketing angle — HTC is also a set of nodes in any chain and has unique access to your shared data and can offer a system similar to what Google does, where you're profiled and targeted when it comes to advertisements.

One thing is certain, the HTC Exodus will be one of 2018's most interesting phones.

All of this is speculation. It's almost certain that the HTC Exodus will be a gateway into cryptocurrency use and include user-facing (and possibly unique developer options) apps and utilities to connect to large clearing houses like Coinbase. Past that, we;ll just have to wait until October and find out. I'm certainly interested in checking out the first blockchain phone, and I'm sure plenty of us feel the same.

Jerry Hildenbrand
Senior Editor — Google Ecosystem

Jerry is an amateur woodworker and struggling shade tree mechanic. There's nothing he can't take apart, but many things he can't reassemble. You'll find him writing and speaking his loud opinion on Android Central and occasionally on Twitter.

  • Blockchain or Blockheads? Another HTC failure, what else is new!
  • It has seemed to me like they've had a history of trying to sell stuff the mass market doesn't care for, and I used to LOVE their stuff. Seems like they really took a nosedive after the m7, which was still pretty popular, but they kept trying to push nice phones with actively terrible cameras on everyone.
  • Thank you, Carnac.
  • Blockchain does NOT automatically mean crypto currency.
  • Blockchain is the buzzword of the week that all of the tech blogs (specifically Tech Crunch) like to throw in a title to get clicks. It's already getting old. More like BOKchain. Bok bok bokchain bokaaak!
  • This will change absolutely nothing about how well HTC is doing as a company.
  • Tis a boondoggle! *Adjusts monocle and sips cocktail*
  • > A blockchain is an *encrypted* and shared database It doesn't have to be encrypted to be a blockchain and, frequently, is not. If by "encrypted" you mean "digitally signed", please, define your terms in front of the article to avoid confusion.
  • Well the HTC Exodus might be their EXODUS from the smartphone market...
  • HTC might finally be on to something.. They need to have phone to phone mesh networking capabilities as well to act as a second internet for regions with poor cellular coverage. Nice to see them thinking out of the box.
  • > They need to have phone to phone mesh networking... Are you sure this is what this phone is about?
  • A mesh network is a good idea in theory, but in practice, it's going to be extremely difficult to implement. First you have to have enough phones in an area to construct a working mesh. And I don't mean just in a local area. To make it possible to get data in and out of the mesh, at least one device in it has to have a connection to the wider Internet. And, the larger the mesh, the more phones you'll need to have outside connections, or else you're going to create a huge bottleneck. Second, and more importantly, you have to figure out how to route data reliably across a mesh of ever-changing nodes. Imagine trying to map a a city. Now imagine having to do it when streets are constantly moving, closing, opening, and new ones are created, only to disappear a moment later. And the map must be correct all the time. Again, a good idea, but the implementation would be extremely difficult. If you want to build a mesh, you'd be better off using stationary nodes connected to multiple neighboring nodes using some sort of directional wireless system, so you can concentrate the signal and get better range. Then have your phones connect to that. As long as enough nodes have sufficient bandwidth to the outside to avoid bottlenecks, it should work. Your latency will be high because of all the hops your data will have to take, but, if you're in the middle of nowhere, you probably won't care.
  • "incorruptible digital ledger" I'm sorry, for every lock made by man, man has developed a way of unpicking it.
  • Although this may be correct, from what I gather from the article, even if someone was to "pick the lock" on their copy and alter it, unless it is authentic, this person's copy will simply be overwritten by a legitimate copy.
  • "unpicking it"? LOL, I think you meant "picking it".
  • I'll admit, I really don't know anything about this.
    In the past I have worked with various databases - and the most common threat to security - is the user who has more authority than knowledge.
    Take a chain of phones, devices etc. with the power to change monetary value - and I am immediately worried. This one I'll sit out and observe.