Disruptive by Design: Changing the World, One Blockchain at a Time
People worldwide are buzzing about digital currencies such as bitcoin and Ethereum. Blockchain is the technology that forms the backbone of some of these new currencies being marketed today.
Blockchain creates a digital decentralized ledger that records all transactions. There is no central point of ownership for the information on the ledger, and the information is transferred among disparate parties. Each time the ledger is updated or verified, a time stamp is assigned and linked back to the previous record. The result is an unchangeable chain of information consisting of blocks—hence the term blockchain.
“In essence, the blockchain is a shared, programmable, cryptographically secure and therefore trusted ledger which no single user controls and which can be inspected by anyone,” explains Klaus Schwab, founder and executive chairman of the World Economic Forum, in his book The Fourth Industrial Revolution. The book, published last January, includes a survey of 800 executives that says well over half believe that up to 10 percent of global gross domestic product will be stored using blockchain technology by 2025.
Blockchain technology offers a way for parties that have not established trusted relationships to reach an agreement on a common digital account. Today digital transactions can easily be faked, forged or duplicated. Blockchain inherently solves this problem without using a trusted intermediary. When new data is entered, it can never be erased. The chain contains real, accurate and verifiable information for each and every transaction.
Due to the tremendous attention bitcoin has received, other sectors are starting to implement blockchain. In the health care sector, for example, we can use blockchain to develop better data sharing between providers, which equates to a higher probability of more effective treatments and lower costs. Imagine in the future if health care records were available to all medical practitioners throughout a person’s entire life from anywhere in the world at a moment’s notice, and the practitioners could be 100 percent confident that the records were completely accurate. Blockchain technology also can allow various stakeholders in the health care value chain to access networks and information without compromising security or integrity.
Ethereum, one specific blockchain implementation, aims to deploy smart contracts and composes the building blocks for decentralized applications and even whole decentralized autonomous companies. Smart contracts are essential business rules built into applications used to accomplish any type of transaction or business function.
With a little innovation, a blockchain application can capture data more efficiently than a centralized application by transmitting data over public blockchains using masking techniques to maintain anonymity. Immutable data and instant transactions are a reality for applications that harness the advantages of blockchain.
Some individuals will use any technology for wrongdoing, but that does not mean the technology is unsafe. “The architecture prevents information tampering and can help with security issues and identity management,” says Misty Blowers, vice president for cybersecurity research at ICF and one of my colleagues. Blockchain does not take into account or protect against social engineering of your private information, but it does protect against data manipulation. Some experts estimate that an attacker on the bitcoin network might need to spend billions of dollars to modify a blockchain. This is because the backbone of many blockchains—there is not just one—uses a cryptographic process known as mining to make tampering nearly impossible.
We are only scratching the surface when it comes to blockchain and its advantages. I think it will be embraced and gain even more traction and visibility in the near future as more companies adopt the technology. Blockchain can truly be a positive disrupter of industry and will change the way we perform certain tasks, just as smartphones did and are still doing for us today.
Jeremy C. Spund, MBA, M.S., is a technical specialist working for ICF. He supports the Defense Department’s Defense Critical Infrastructure Program through developing and supporting technological capabilities. He is vice president of internal operations and membership for the Young AFCEAN Advisory Council, 2016 Regional Distinguished Young AFCEAN, and second vice president of AFCEA’s South Florida Chapter.