In 1991, a group of researchers developed a method for date-stamping digital documents so that they cannot be backdated or tampered. In 2009, ‘Satashi Nakamoto’ used this blockchain technology for Bitcoins.
While Bitcoins was its first ever transaction, blockchain has now found lots of other uses.
This technology, touted as the next big thing in the way we store information, provides the ultimate solution for security. In simple terms, blockchain comprises a series of unalterable records of data (block) managed by a cluster of computers. Each of these blocks is secured by (chain) and bound to each other by using cryptographic principles.
What is a blockchain?
Let us go over the definition in detail relating it to a set of medical records of an individual to understand what’s special about this.
A block is a digital record of information. Take an individual’s health check up information in the certain year as the first record or block. Next year he undergoes another check up. The results are different for the same parameters such as blood analysis, etc. Now, the second year’s results are not overwritten on the first year’s in the first block. A new block (call it second block) is created with complete health checkup information. This block is linked cryptographically to the first block. During the second year the individual develops an ailment for which his family doctor who prescribes some medicines. This information is again stored as a block (third block) and is linked cryptographically with the second block, thus forming a chain.
Many persons can accesses such data. In this case it would be the individual, the family doctor and the hospital. So, when a new block is created, the blockchain technology ensures that this block is duplicated in the other two computers of the network as well.
Linking the blocks
As a new block is created, the technology creates a ‘hash’ using an algorithm. A hash algorithm turns a large amount of data, into a fixed-length ‘hash’. The same ‘hash’ will always result from the same data, but modifying the data by even one bit will completely change the ‘hash.’ In this way, the blocks get chained to each other sequentially. See the figure showing the blocks arranged in a chain using an unique hash.
Better DATA safety
Suppose someone wants to alter some data in second block. He accesses the data and changes. Immediately
the system will recalculate its ‘hash,’ which will now be different. When he now tries to insert this block, the system will check the new ‘hash,’, recognise it as not part of the chain and reject the move. Not only that. All these blocks with chains are copied in all the computer systems in the network. All these computer systems individually carry out the ‘hash’ check for chaining. So, even if by chance a hacker manages to introduce the block with changed data in one computer, the system will still throw it out as the other computers in the network would be rejecting it.
Summarising, a blockchain is essentially a ledger of digital records, shared by various parties, which can only be updated by consensus of the participants. Most importantly, information once entered can never be erased.
Blockchain Technology is a boon wherever security of data is paramount. Mention has already been made of medical records. Take the case of land records. It is estimated that as many as two thirds of the civil cases pending in our courts relate to land disputes, most of which relate to establishing ownership. Imagine how this can be minimised by having the land records using blockchain. Aadhaar records are another application suggested for blockchain.
Are there no negatives? Of course, there are. Blockchain relies on encryption and complex algorithms to provide its security as well as to establish consensus over the distributed network. Plus, there is over redundancy in having all blocks replicated in all connected nodes of the network. These, in turn, require large amounts of computing power raising cost of operation. Again due to their complexity and their encrypted, distributed nature, blockchain transactions can also take a while to process, compared to traditional systems.
As of now, blockchain technology has not yet found universal acceptance. Despite its soundness in ensuring security, its future is unclear.
