Mathematicians call the principle of blockchain a “linked list. Each element depends on the one before it and the one after it. Changing or removing one block will break the sequence and trigger a security mechanism. Recently, full stack blockchain development services have been popular. It is a very convenient, evenly finished product in a short time.
The purpose of the blockchain is to authenticate the database. The mechanism blocks attempts to spoof information, preventing one participant from breaking the rules and profiting from it.
Blockchain is considered a relatively new technology – the word itself became popular only recently. But the prototype of such a system dates back to 1984. The first blockchain was described by scientists Haber and Stornetta in a 1991 paper. And the first working model appeared in 1994 – it helped confirm the authenticity of publications and protect them from plagiarism.
How does blockchain work?
Suppose you need to record valuable information and make sure no one can tamper with it. You digitally record the data and encrypt it to ensure complete confidentiality. This array is sent to all users (nodes) that are connected to a particular network. Each of them receives an exact copy. If you suspect spoofing, all you have to do is compare one copy with another.
But the process of comparing hundreds or thousands of lines is a time consuming task. If there are hundreds of thousands of participants in the network, it would take all the computing power in the world to accomplish this task. That’s why blockchain uses a checksum or hash. This is an encrypted header that is assigned to an array of data. If you change a single character, the hash will also change – it will become noticeable in the comparison.
The blockchain platform is dynamic – it is designed to constantly add new information. Most of the time it’s about transactions, i.e. money transfers between users. But in theory, you could use the technology to authenticate anything – scientific publications, art, and identity documents.
Where can blockchain be used?
Cryptocurrencies
One of the first spheres of human activity where technology has found application. Blockchain wallet is a record in a decentralized network. Its balance and related transactions are contained in blocks that all participants have.
It’s even safer than keeping money in a bank. If a hacker breaks into a bank server, all he has to do is change one record. To tamper with blockchain transaction information, he would need to tamper with hundreds of thousands of records on different devices.
The cryptocurrency system is considered more honest and transparent than conventional finance. All members of the network see the amount of money in circulation and control Blockchain transactions. The likelihood of fraud and manipulation is minimized.
Banking
Large financial institutions initially considered blockchain and cryptocurrencies as direct competitors. However, since 2014, they began to massively implement the new technology. In this sphere, it is used on two levels:
Public blockchains control the transactions of ordinary users;
Private blockchains monitor interbank transactions. They are a consortium (association) of banks linked by common contracts. For a transaction to be considered genuine, it must be validated by a majority of participants, such as 10 out of 12 banks.
Formation
As we mentioned above, one of the first blockchains in the world was designed to verify the authenticity of scientific publications. The system still works today – it helps resolve disputes about research primacy, plagiarism, and authorship.
The blockchain principle is useful for universities in other industries as well. Distributed networks take care of administrative work – checking received documents and homework, confirming the authenticity of certificates, credits and patents.
Cybersecurity
The most promising use of technology. Blockchain can be used to create a unique key for authentication that will be validated by all users of the network. The switch would be quickly exposed, allowing the system to react instantly to an attempted intrusion.
Prospects for blockchain
Experts of Kiss.Software company argue that blockchain transactions will form the basis of the next generation of the Internet – Web3. Ideally, this network should put the user first – they want to make it free and decentralized, with minimal censorship, monopolies and government interference. Time will tell how realistic this utopian idea is.
But new types of blockchain are already being prepared for use in different areas of human activity:
1. Industry – to speed up production contracts and control the supply chain.
2. automobiles – to create an electronic key to access both personal and carshare cars.
3. Cash verification – future banknotes and coins will contain electronic keys that can be checked with a smartphone.
