Every once in a while, a new technology, an old problem, and a big idea turn into an innovation. Blockchain is this innovation. It is the biggest opportunity set we can think of over the next decade. Blockchain completely changes the perception of who controls the data and gives individuals the exclusive rights over the information pertaining to them.
Blockchain is a decentralized data management system. Its name translates literally into its functionality. A Blockchain consists of chunks of data known as blocks connected to each other in the form of a chain. Multiple copies of such chains are maintained and updated all over the world. Any discrepancy observed in a chained copy maintained by a volunteer can be then corrected with the help of other copies in the world.
In today's scenario, The storage of your data spans multiple servers and such physical environments are typically owned and managed by hosting companies. Most of the data is centralized and between the server and the client, the hosting companies can act as the third party. Every now and then we get to hear about the mismanagement of such sensitive information by hosting companies.
● The Facebook-Cambridge Analytica scam
● Indian Jobseekers scam 2019
● SORM Data leaks
Moreover, centralized information is susceptible to cyber-attacks. At times even states are at risk.
Blockchain works as the ultimate remedy to such problems.
Blockchain is a ledger or diary which is impossible to forge setting up a mapping between owner and objects. Think about multiple diaries being maintained by individuals about the same thing. For example let us consider a transaction, the record of which gets simultaneously updated in all diaries all over the world.
These diaries now keep the record of all previous transactions with this new transaction in the same order. If anyone tries to maliciously change one of the diaries the changes would be caught.
The real system works in pretty much the same way. All over the world, nodes exist which keep a record of a particular Blockchain. A node is a computer when the nodes that are on the network all over the world validate the addition of a block then only the Blockchain is updated.
Whenever a new block is added, it’s HASH value is also calculated. The HASH value is an alphanumeric string generated by a mathematical function that takes the message in the block as the input.
Each new block holds the HASH of the previous block and thus the Blocks are chained.
Any change in the information in the block would change it a HASH value, note that the blocks get added to the chain with their HASH value thus a changed HASH value would make the chain redundant.
The Blockchain updates itself every ten minutes. It does so automatically. No master or central computer instructs the computers to do this.
As soon as the spreadsheet or ledger or registry is updated, it can no longer be changed. Thus, it’s impossible to forge it. You can only add new entries to it. The registry is updated on all computers on the network at the same time.
Various nodes compete to add a new block to the Blockchain, once done by one, others also get updated. Signatures are maintained to ensure privacy so that individuals whose data is being saved can only access it.
The best way to implement Blockchain technology in any field is to structure it’s working around the Smart Contracts concept. The best way to describe smart contracts is to compare the technology to a vending machine. Ordinarily, you would go to a lawyer or a notary, pay them, and wait while you get the document. With smart contracts, you simply drop a bitcoin into the vending machine (i.e. ledger), and your escrow, driver’s license, or whatever drops into your account. Thus an asset or currency is transferred into a program and the program runs some code and automatically validates a condition to determines whether the asset should go to one person or back to the other person, or whether it should be immediately refunded to the person who sent it or some combination thereof. In the meantime, the decentralized ledger also stores and replicates the document which gives it a certain security and immutability.
The very popular cryptocurrencies make use of Blockchain. Cryptocoin doesn’t have any centralized server used for its issuing, transactions, and storing, as it uses a distributed network public database technology named blockchain, which requires an electronic signature and is supported by a proof-of-work protocol to provide the security and legitimacy of money transactions. Bitcoin is one such example. Bitcoin’s market cap surpasses $138 billion and this is the most popular kind of digital currency. Read here to know more about Bitcoin.
Blockchain technology can facilitate the transition from institution-driven interoperability to patient-centered interoperability. Blockchain technology allows patients to assign access rules for their medical data, for example, permitting specific researchers to access parts of their data for a fixed period of time. With blockchain technology, patients can connect to other hospitals and collect their medical data automatically.
A blockchain-based digital government can protect data, streamline processes, and reduce fraud, waste, and abuse while simultaneously increasing trust and accountability. On a blockchain-based government model, individuals, businesses, and governments share resources over a distributed ledger secured using cryptography. This structure eliminates a single point of failure and inherently protects sensitive citizen and government data.
With abundant possibilities, Blockchain opens up to a new era of information technology with much better and secure use of one's data.
Blockchain is a decentralized data management system. Its name translates literally into its functionality. A Blockchain consists of chunks of data known as blocks connected to each other in the form of a chain. Multiple copies of such chains are maintained and updated all over the world. Any discrepancy observed in a chained copy maintained by a volunteer can be then corrected with the help of other copies in the world.
In today's scenario, The storage of your data spans multiple servers and such physical environments are typically owned and managed by hosting companies. Most of the data is centralized and between the server and the client, the hosting companies can act as the third party. Every now and then we get to hear about the mismanagement of such sensitive information by hosting companies.
● The Facebook-Cambridge Analytica scam
● Indian Jobseekers scam 2019
● SORM Data leaks
Moreover, centralized information is susceptible to cyber-attacks. At times even states are at risk.
But what makes Blockchain a big game-changer?
Blockchain works as the ultimate remedy to such problems.
Blockchain is a ledger or diary which is impossible to forge setting up a mapping between owner and objects. Think about multiple diaries being maintained by individuals about the same thing. For example let us consider a transaction, the record of which gets simultaneously updated in all diaries all over the world.
These diaries now keep the record of all previous transactions with this new transaction in the same order. If anyone tries to maliciously change one of the diaries the changes would be caught.
The real system works in pretty much the same way. All over the world, nodes exist which keep a record of a particular Blockchain. A node is a computer when the nodes that are on the network all over the world validate the addition of a block then only the Blockchain is updated.
Whenever a new block is added, it’s HASH value is also calculated. The HASH value is an alphanumeric string generated by a mathematical function that takes the message in the block as the input.
Each new block holds the HASH of the previous block and thus the Blocks are chained.
As soon as the spreadsheet or ledger or registry is updated, it can no longer be changed. Thus, it’s impossible to forge it. You can only add new entries to it. The registry is updated on all computers on the network at the same time.
Various nodes compete to add a new block to the Blockchain, once done by one, others also get updated. Signatures are maintained to ensure privacy so that individuals whose data is being saved can only access it.
Smart Contracts
The best way to implement Blockchain technology in any field is to structure it’s working around the Smart Contracts concept. The best way to describe smart contracts is to compare the technology to a vending machine. Ordinarily, you would go to a lawyer or a notary, pay them, and wait while you get the document. With smart contracts, you simply drop a bitcoin into the vending machine (i.e. ledger), and your escrow, driver’s license, or whatever drops into your account. Thus an asset or currency is transferred into a program and the program runs some code and automatically validates a condition to determines whether the asset should go to one person or back to the other person, or whether it should be immediately refunded to the person who sent it or some combination thereof. In the meantime, the decentralized ledger also stores and replicates the document which gives it a certain security and immutability.
Applications of Blockchain
Trade
The very popular cryptocurrencies make use of Blockchain. Cryptocoin doesn’t have any centralized server used for its issuing, transactions, and storing, as it uses a distributed network public database technology named blockchain, which requires an electronic signature and is supported by a proof-of-work protocol to provide the security and legitimacy of money transactions. Bitcoin is one such example. Bitcoin’s market cap surpasses $138 billion and this is the most popular kind of digital currency. Read here to know more about Bitcoin.
Healthcare
Blockchain technology can facilitate the transition from institution-driven interoperability to patient-centered interoperability. Blockchain technology allows patients to assign access rules for their medical data, for example, permitting specific researchers to access parts of their data for a fixed period of time. With blockchain technology, patients can connect to other hospitals and collect their medical data automatically.
Governance
A blockchain-based digital government can protect data, streamline processes, and reduce fraud, waste, and abuse while simultaneously increasing trust and accountability. On a blockchain-based government model, individuals, businesses, and governments share resources over a distributed ledger secured using cryptography. This structure eliminates a single point of failure and inherently protects sensitive citizen and government data.
With abundant possibilities, Blockchain opens up to a new era of information technology with much better and secure use of one's data.
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