Blockchain: What We Should Know

We hear much today about the possibilities of the use of blockchain in education and other applications. Let’s consider how we should understand blockchain terms and concepts and be able, if needed, to explain the technology for the audiences we serve.

One take on the subject comes from the Why Higher Ed Should Do More with Blockchain Tech article that recently appeared in Campus Technology. Another take comes from  a related article Charles Dull and I worked on for an issue of STC’s Intercom magazine.

The Campus Technology article explains how Oral Roberts University “recently held a conference to persuade higher education institutions that it’s time to get on board the blockchain train” with the event’s organizer stating that will be as important to transforming education as the internet was. One application could be with the secure ledger concept

The following graphic comes from IBM Blockchain  and  gives an overview on the subject.

 

In the article in Intercom, Chuck Dull shares his thoughts about blockchain and the value of trust and technology.
Dr. Dull serves as the Associate Dean for the IT Center of Excellence at Cuyahoga. Community College. Here are his thoughts.

In personal relationships trust is critical. You want to trust your friends, family and spouse. A breakdown in trust is a breakdown in a relationship. Technology was built on a similar principle.  You trust the email you are getting is from the person in the header. You trust the bank you log into is going to manage your accounts electronically. You trust the purchase you just made was authentic and more.

The reality has been of late that there is a trust breakdown in technology, email SPAM and Phishing that hack into your system, hacks into secure transactions with an inability to verify and authenticate identity for a simple purchase. The challenges are so serious that some mobile phone service providers are using a process to identify potential SPAM calls. So while trust is a noble trait for people it is often co-opted in technology, and at times we do not even know.

So as we ponder the trust paradox, it may be time to consider a trustless process that is tamper evident. Enter the blockchain. Blockchain technology was first developed as a method to enact cybercurrency transactions. Those who developed the technology hold a deep seated belief in protecting personal privacy. While cybercurrencies were designed to work independent of any central bank in any county, the technology that is used for transactions has benefits for the very central banking and retail entities they oppose.

The simplest explanation for blockchain is that it is a trustless, tamper evident process that uses math as the backbone for authenticating identities. Another advantage is Blockchain is a DDMS or a distributed database management system. Some would argue it is more of a replicated database, but for our purposes distributed will help with the discussion. It is distributed since every Block in the chain has all of the information for all of the transaction activity, you do not need to check a bank, check a receipt, etc. it is all in the Block.

Blockchain is a chain of blocks or records of transactions that have been mined and authenticated NOT by trusted people or banks but by solving complex math problems. Each Block has all of the information for the transaction and has a connection to the previous block. In order to tamper with one Block, you have to have a process to tamper with every Block and solve every new math problem that would be created.

The advantages to eliminating hacked finances should be evident, having one Block with all transactions. Think for a moment about a title to a house or car and all the places you would have to go to verify your ownership and authenticate your identity. If property transfers were in a blockchain, this would all be in a Block. This sounds all very simple for an extremely complex process. The math alone used to solve the blockchain access is a complex process. The challenges with blockchain now are power consumption; it takes an incredible amount (comparably) of electric power for a single blockchain transaction. However, the potential to eliminate hacking cannot be ignored.

In the cryptocurrency world there have been hacks, false chains created, and other methods of theft. The key here is the blockchain was not hacked and false chain was created. In blockchain transactions balances follow the block, you have a ledger of unspent funds that follow, this requires a process to track all of your unspent funds and some moving to use all, but the takeaway here is everything needed for the transaction is kept in the Block using a distributed ledger in a distributed database. Taking cryptocurrency away from Blockchain, you find that even central banks like Chase and large legacy corporations like IBM now have blockchain technology or are usingbBlockchain technology.

Blockchain also solves the personal authentication challenge. Authentication, identification and validations are terms often used to mean the same thing and they are all very different. Using a license to prove who you are is an identification process. Authentication is a process where something else must happen to validate the transactions. Many banks and other secure services, for example, have adopted two-factor authentication routines, where once you log in, you are then sent another code to enter to validate the process. In Blockchain authentication happens first in a way to protect your personal identity and second to protect the validity of the transaction. Blockchain requires users to establish public and private keys and you guessed it the process requires a mathematical routine. The keys are connected; the public key is used for transactions and is authenticated by the private key. The transaction never reveals identify, but through authentication the users transact or even communicate.

The most challenging part is Blockchain has variations and trying to lockdown one method that is THE Blockchain Technology is just not possible. There are fundamentals, and no doubt as adoption increases you will see standards develop. The potential is there; the math is complex, but the value of a trustless system for technology is worth the change.

By Jeanette Evans