Simply put, a blockchain is a continuously expandable list of data records (“blocks”) whose concatenation is based on cryptographic procedures. Each block usually contains a cryptographically secure hash, i.e. a scatter value, of the preceding block, as well as transaction data and a timestamp.
What makes blockchain technology so secure and reliable is the way in which data is stored: because transactions are built on top of each other via coding, it is not possible to change or even erase the existence or content of a previous transaction. If one tries to do so, all subsequent transactions contain errors and serve as proof of the changes that have been made. Although all network participants have equal access to the data records, they do not have unrestricted access. Intermediate steps between the individual transactions ensure that the data is additionally encrypted. Sensitive data is thus only stored locally and registered on the blockchain by hash value.
Thus, blockchain technology is suitable for all business areas in which security and verifiability of transactions are indispensable. The best-known area of application is certainly the cryptocurrency Bitcoin. However, blockchains can basically be used everywhere where verifiability and quality assurance are necessary, for example in financial services, production and delivery of food and healthcare.
Blockchain creates legal certainty
Blockchain is by no means limited to cryptocurrencies and the financial sector. The fields of application are broadly diversified. They include marketplaces for data, management of identities, lending of money, venture funding and loans for the self-employed. In addition, there are numerous players that position themselves as basic platforms for third parties.
Contracts of various kinds can also be processed via blockchain. These are so-called smart contracts: Contracts no longer exist in paper form, but are embedded in computer protocols. These verify or support the technical negotiation or settlement of a contract. Authorities, notaries, lawyers and auditing firms are no longer needed to validate such documents.
Blockchain – paving the way for the digital health economy.
Another area where Blockchain technology offers the highest level of security is in the transaction of healthcare data. According to a study by market research firm Frost & Sullivan, the convergence of Blockchain with innovative technologies such as mHealth and the Internet of Medical Things will open up new opportunities for the development of a digital health economy. “New, connected medical devices and the need to protect data from data breaches make blockchain technology, with its comprehensive security infrastructure, the obvious solution for emerging digital workflows and advanced interoperability in healthcare,” explains Kamaljit Behera, Transformational Health Industry Analyst at Frost & Sullivan. “It provides an additional layer of security through a unique distributed network match that uses encryption techniques to minimize cyberattacks.”