Traditionally, we perform digital transactions by storing data in a centralised database and the transactions performed are updated one by one on the database. That is how the ticket booking websites or banks operate. However, since all the data are stored on a central location, there are chances of data being hacked or lost.
The blockchain technology works on the concept of decentralised and shared database where each computer has a copy of the database. A block can be thought as a secured chunk of data or valid transaction. Each block has some data called its header, which is visible to every other node, while only the owner has access to the private data of the block. Such blocks form a chain
called blockchain as shown in Figure. We can define blockchain as a system that allows a group of connected computers to maintain a single updated and secure ledger. Each computer or node that participates in the blockchain receives a full copy of the database. It maintains an ‘append only’ open ledger which is updated only after all the nodes within the network authenticate the transaction. Safety and security of the transactions are ensured because all the members in the network keep a copy of the blockchain and so it is not possible for a single member of the network to make changes or alter data.
The most popular application of blockchains technology is in digital currency. However, due to its decentralised nature with openness and security, blockchains are being seen as one of the ways to ensure transparency, accountability and efficiency in business and as well as governance systems.
For example, in healthcare, better data sharing between healthcare providers would result in a higher probability of accurate diagnosis, more effective treatments, and the overall increased ability of healthcare organisations to deliver cost-effective care. Another potential application can be for land registration records, to avoid various disputes arising out of land ownership claims and encroachments. A blockchain-based voting system can solve the problem of vote alterations and other issues. Since everything gets stored in the ledger, voting can become more transparent and authentic. The blockchain technology can be used in diverse sectors, such as banking, media, telecom, travel and hospitality and other areas.
