Last summer, I had my eyes opened to a magical new world. What is this new world, you ask? Blockchain! In this article, I will give you a breakdown of what blockchain is and how it works. Additionally, I will make some predictions and offer some opinions on where the technology is heading. To understand what blockchain is we first must understand web 3.0.
What is Web 3.0?
Simply put, Web 3.0 is the future of the internet. To understand this, you must understand where the web originated from. The first era of the internet age was Web 1.0. Web 1.0 was nothing more than static HTML pages. No dynamic content, no cloud computing, no online banking, etc. Web 1.0 was as basic as the internet could get. Next, came Web 2.0, the “modern-day” web. Web 2.0 is the web as we know it today. Major players like Google, Microsoft, and Amazon control (or play a part in) the vast majority of the Petabytes of data that cross the internet every day. An important item to note is these companies own (or at least safeguard) your data, as it is stored on their servers. Now, privacy laws such as the GDPR are attempting to provide protections for user data, but fall short when compared to Web 3.0.
Web 3.0 is an entirely new way of thinking about how users interact with the internet. It is based on a decentralized anonymized platform that provides users with complete control over their data. Users’ data is no longer stored on a single company’s centralized servers, rather, it is stored on the Blockchain.
What is the Blockchain?
While “blockchain” may seem like super-hyped tech lingo, it is actually fairly intuitive when explained properly. If you have ever made a to-do list, you can understand the blockchain. Let me explain. On a to-do list, each item is listed one after another in consecutive order (a list 😀). Every item on that list is representative of a task, or data if you will (data in this sense simply means a piece of information). Imagine that you write the number 1 beside each item. For example:
- Do Laundry – 1
- Feed Pets – 1
- Wash Dishes – 1
- Buy Groceries – 1
- Water Plants -1
What is a block?
Now, think of the data, or the list item (e.g. “Do Laundry”), and the number 1 (i.e. “Do Laundry – 1”) as a block. This is where the “block” in blockchain comes from. So, “Do Laundry – 1” is the first block, “Feed pets – 1” is the second block, “Wash Dishes – 1” is the third, and so on and so forth. This is the very basis of blockchain. These individual blocks make up a ledger (or list). The blocks on this ledger are then linked mathematically with a digital fingerprint.
But why is it called blockchain?
The 1’s on our to-do list act as a unique fingerprint for each of the blocks on our ledger. How so, you ask? Well, imagine that you take the 1 in the first block and add it to the 1 in the second block. The resulting answer would then be 2. This mathematical fingerprint thus proves the validity of the chain of blocks because it is mathematically verifiable that 1 + 1 = 2. The rest of the chain would follow like so:
- Block 1 – “Do Laundry, 1” Fingerprint = (1) = 1
- Block 2 – “Feed Pets, 1” Fingerprint = (1 + 1) = 2
- Block 3 – “Wash Dishes, 1” Fingerprint = (1 + 2) = 3
- Block 4 – “Buy Groceries, 1” Fingerprint = (1 + 3) = 4
- Block 5 – “Water Plants, 1” Fingerprint = (1 + 4) = 5
The technical term for this fingerprint is a cryptographic hash. This hash confirms that the block has not been modified at any point on the chain, thus confirming the security of the data “on-chain”.
How does blockchain work?
Blockchain is distributed in nature, which is the core tenant of blockchain privacy and security. The blockchain is not one single entity hosted on one central server or location, rather it is multiple copies of the same ledger stored on multiple computers throughout the world (known as the blockchain’s “network“). The computers in the blockchain’s network frequently compare their copies of the blockchain with each other to see if they have been modified by a malicious actor. As long as 51% of the blockchain’s network agrees on the valid version of the ledger, the blockchain’s data is secure.
Now, if a malicious actor were to get 51% of the blockchain’s network to agree (known as consensus) that a modified version of the original ledger is correct, then the network has been compromised. Rest assured, though, that while a 51% attack can happen, it is highly improbable on any of the major blockchain networks.
As for the future of blockchain, I foresee a large portion of blockchain’s value coming from its logging functionality. I believe that blockchain has many use cases in this area, especially in the cybersecurity field with things such as SIEM, digital forensics, heuristics-based Firewalls, computer and network system auditing, and much more. Additionally, NFTs will provide multiple benefits in all aspects of the CIA triad, as well as things such as software licensing and consumer privacy.