The Blockchain Concept
"The new technology of trust" is how Goldman Sachs describes blockchain in their online presentation. They describe blockchain as a continuously updating ledger, a way to store data which is "virtually impossible" to change without being detected. Time-stamps at the time of the transaction and hash codes passed sequentially to each block in the data chain for each entry prevent any later alterations. Goldman Sachs expects blockchain to revolutionize transactions involving money transfers, exchanges of goods and verified identity.
A Blockchain Analogy
You don't need intricate technical knowledge to put blockchain to work, any more than you need to know how to build an internal combustion engine to drive your car. But it is important for businesses and consumers to grasp the basic principles of this up and coming technology.
One of the best analogies we've found to wrap your mind around the blockchain concept is to think about the sharing functions for editing Google Docs with multiple users vs the more limited capabilities of Microsoft Word. Author of the book "The Blockchain is the New Database, Get Ready to Rewrite Everything", and startup entrepreneur William Mougayar came up with the Google Docs vs. Microsoft Word analogy to explain the advantages of blockchain over current internet technology.
Bitcoin Proves the Concept
Mougayar's book was written in 2014. Now, three years later Bitcoin, the cryptocurrency nick-named "virtual gold" has come into its own as the proof-of-concept for blockchain technology. The value of Bitcoin commerce stands at about 9 billion in US currency. The decentralized features of blockchain have security potentials far beyond its current platform for Bitcoin, Ethereum, and other cryptocurrencies.
Blockchain's decentralized process, spreading blocks of data across a network of "nodes" (computer processors) eliminates the vulnerabilities on which hackers thrive. Usernames and passwords are replaced by a long randomly generated encrypted number, known as a public key.
Stored on thousands of computers, the public key is recognized and validated by the network. Since the blockchain network data is so dispersed, and no critical data is stored at any centralized computer, hackers have no single vulnerable points to attack. This enhances cyber-security for:
- Blocking identity theft- Digitized fingerprints and reliable ID for trustworthy buying, selling, and transfers.
- Preventing data tampering- Sequential hash codes and timestamps prevent alteration of data after the fact. The network would detect mismatches immediately.
- Stopping distributed denial-of-service (DDoS) attacks.- A hacker would have to devote immense computer resources to simultaneously shut down the thousands of computers storing blocks in the chain.
🏙 At Techmedics we stay on the leading edge of cyber-security. Thanks for giving us the opportunity to get you up to speed on what's sure to be revolutionary blockchain technology.