Blockchain technology is becoming an increasingly popular buzzword in the tech industry. Even though the concept was developed in 1991 and it’s been in use since about 2009, many businesses are still at a loss as to what blockchain really is, and more importantly, how to apply it to their business.
We answer the questions and help provide the building blocks of blockchain in this rapid-fire guide for beginners.
What Is Blockchain?
Remember when hotels used to have large guest books on their front desks, and anyone could sign and browse through to see who else stayed there? Now, imagine that guest book being available on the internet for anyone to view or electronically sign. That’s similar to how blockchain works.
A blockchain is a ledger of publicly-made data entries which is connected to the internet. Information that is recorded in a blockchain is stamped with the time and date. Once the entry has been made, it cannot be removed or changed.
How Blockchain Works
The name ‘blockchain’ refers to the manner in which data entries are organized. Each entry represents a block, and these entries link together like a chain to create a traceable information trail. That structure is why blockchain is considered a trustworthy source of information.
Because data cannot be altered on a block without also altering subsequent data blocks, other participants in the blockchain network will see any changes or discrepancies.
Blockchain data isn’t owned by a single entity or computer, but rather exists across a network of computers, devices, and contributors. Making entries in the ledger requires a network approval, and blocks are automatically linked one after the other in the order in which they are added. This eliminates the potential for new blocks of data to be placed between existing blocks, which further supports the security and integrity of the data throughout the chain.
Use Cases for Blockchain Technology
Businesses across many industries can benefit from the transparency, integrity, and security that blockchain technology provides. One of its most common use cases is in making transactions with Bitcoin or similar currency. In this instance, money becomes traceable as it changes hands.
Voting is another promising use case for blockchain. Historically, users had to be physically present to cast a vote. Though this may change in the upcoming election with more people championing mail-in votes, blockchain can add a layer of extra security to prevent voter fraud. It can provide clarity into who is casting their votes, digitize more of the process, and since the data is tamper-proof, it can make other voting alternatives more trustworthy.
Right now, blockchain is being used in supply chain management systems, with Specright as a pioneer. Our SDM platform helps to improve product transport and traceability, as well as product authenticity and supplier reputation.