In the past couple of years, blockchain has gained popularity due to its usage in the cryptocurrency world such as Bitcoin. But blockchain extends far beyond the crypto world.
What is Blockchain?
Blockchain is a digital technology that allows for a database to be shared and decentralized with multiple parties. Instead of the database being fully centralized in one place, the database is distributed across a network of computers.
How Does It Work?
In a blockchain, there are two essential parts: blocks and chains that hold them together.
- A block contains pieces of information or data that are grouped together. Each of these groups (blocks) is given a unique identifier known as a hash.
- After a block contains all of the data needed, it will link to the last complete block. Each block is connected chronologically and each hash has a reference to the previous block.
In blockchain, there is no centralized area where one user has control over all data. The database is decentralized by being replicated and stored in multiple areas.
In order for a new block to be added to the chain, there must be a consensus of the data being correct and confirmed by multiple computers. This can be done through proof-of-work or proof-of-stake.
Blockchain is a technology that has become popularized and has stayed around due to its transparency, security and immutability to alter or change data once all parties have confirmed that data to be true and a block is formed.
How Else Can It Be Applied?
Beyond cryptocurrency, blockchain can be applied to multiple industries. These industries include but are not limited to, insurance, healthcare, real estate and manufacturing.
Blockchain can provide security, efficiency and transparency to the insurance industry. The security provided can include customer identity verification, fraud protection and re-verification of reinsurance and risk pooling. It drives efficiency by streamlining claims processing, enabling more efficient reinsurance and risk pooling programs as well as self-executing smart contracts. The transparency that blockchain can create applies to the claims processing status and collaboration in risk management and underwriting.
The healthcare industry has many records and data to manage. Blockchain allows for the secure storage of medical records such as patient data, medical history and treatment information. There is also the capability of data security and seamless sharing of data between healthcare providers with patient consent. There is also the benefit of leveraging the aspect of transparency that blockchain provides to clinical trials and research to securely record and share results, protocol and data.
In real estate, blockchain can be useful to streamline a variety of processes including property management, record ownership rights and property transactions. It can also help automate processes to reduce paperwork and increase transparency with smart contracts.
Blockchain provides the benefits of transparency and traceability. It can be beneficial in supply chain management to see the production process, in quality control to record and store data on tests, inspections, and certificates, in supplier management to streamline management processes with a decentralized ledger and with smart contracts to have able to self-execute agreements with predetermined conditions and rules.
At EOX Vantage, our team evaluates each customer's needs individually to provide the best solution for them. If your systems need an independent, secure way to store data, ask us about implementing blockchain for your system!