Blockchain is still in its infancy but it is one of the most promising technologies which is going to change our lives. Blockchain applications will disrupt existing processes across variety of industries including manufacturing, trading, shipping, finance, government, real estate and healthcare. We are about to see more change than we could imagine with Blockchain.
What is Blockchain?
A Blockchain is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a cryptographic hash of the previous block, a timestamp and transaction data. By design, a Blockchain is inherently resistant to modification of the data. It is an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. For use as a distributed ledger, a Blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for inter-node communication and validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority and the tampering would become evident.
Traditionally, data is kept in a server which is owned and operated by a third party company. This has some disadvantages: A 3rd party has access to your data, it might be destructed, it might be tampered, and it might be leaked. Using Blockchain, the data is encrypted and then spread in a distributed network of computers. This way, it is not owned by anyone, it cannot be destructed, and it cannot be tampered with.
Blockchain was invented by Satoshi Nakamoto in 2008 for use in the cryptocurrency Bitcoin, as its public transaction ledger. The invention of the Blockchain for bitcoin made it the first digital currency to solve the double-spending problem without the need of a trusted authority or central server. The Bitcoin design has been the inspiration for other applications. Bitcoin is merely just one application of Blockchain and in this article we will explore the many other applications of Blockchain which will become a reality in the near future.
Distributed Cloud Storage
Blockchain data storage will become a massive disruptor shortly. Current cloud storage services are centralized and the users must place trust in a single storage provider. They control all of your online assets and data. With the Blockchain, this can become decentralized. Anyone on the internet can store your data at a pre-agreed price. Hashing and having the data in multiple locations are the keys to securing it.
Smart contracts are legally binding programmable digitized contracts entered on the Blockchain. Smart contracts solve the problem of intermediary trust between parties to an agreement. It ensures that all ledger participants know the contract details and that contractual terms implement automatically once conditions are met. Smart contracts can be used for all sort of situations, such as financial derivatives, insurance premiums, property law, and crowd funding agreements, among others.
Blockchain protects your identity by encrypting it and securing it from spammers and marketing schemes, resulting in seamless sign-on and reduced fraud. Blockchain technology offers a solution to many digital identity issues, where identity can be uniquely authenticated in an irrefutable, immutable, and secure manner. Current methods use problematic password-based systems of shared secrets exchanged and stored on insecure systems. Blockchain based authentication systems are based on irrefutable identity verification using digital signatures based on public key cryptography. It can be applied to passports, e-residency, birth certificates, wedding certificates, death certificates, IDs etc.
Internet of Things (IOT)
Security remains a top concern for the IoT ecosystem as it exposes multiple devices, huge amounts of data, supply chain partners and the community as a whole to security breaches. Blockchain can help solve many of these security and trust challenges. A distributed ledger is well suited to provide IoT device identification, authentication and seamless secure data transfer. It eliminates third party intervention and protect the data from tampering. IoT devices are directly addressable with Blockchain, providing a history of connected devices for troubleshooting purposes.
The greatest barrier to getting electoral processes online is security. Hackers can rig the electronic system to manipulate votes. Using the Blockchain, the ledger would prevent this since votes become encrypted. A voter could check that her or his vote was successfully transmitted while remaining anonymous to the rest of the world. Blockchain technologies will become the set standard for all nations of the world shortly. It is time for our system and governments to become more transparent.
Digital advertising faces challenges such as domain fraud, bot traffic, lack of transparency and lengthy payment models. The issue is that incentives are not aligned, causing both advertisers and publishers to feel they are on the losing side of the deal. The Blockchain is the solution to bring transparency to the supply chain because it inherently brings trust to a trustless environment.
The bottom line is, Blockchain is here to stay and is transforming how our society functions.