Bitcoin, Ripple and Ethereum are the buzzwords of our day and all these buzzwords have a common foundation; they are built on blockchain technology. Certainly, in the financial world, where interested parties are making themselves very rich or very poor, depending on the hour, day or week.
While some of the uses of blockchain can be rather volatile, the underlying technology is proven, and its strengths solve several problems facing companies today. Voting is one example. I refer to concerns such as: “Did the counters miscount the votes?”, “Did my vote make it to the counting station?”, “Was my vote falsified?” and “Even if the counting was correct, can I trust the published results?”
Firstly, it will be helpful to understand a little about how blockchain works. The beauty of this technology is that its inherent characteristics make it the ideal solution for several use cases, with many more use cases being discovered as the technology becomes mainstream.
To get to the point, I will need to go back to basics on what seems to be an unrelated topic. Traditional databases.
A possible home for data is in a database, voting data being no exception. Traditional databases are controlled behind the walls of the database owner or company, for good reason as the data stored here often belongs to the database owner. This database owner can alter the data within the master database at any time. Data can be added or edited or removed with ease. In the more sinister scenario, if a hacker gains access to the database, this hacker could add, edit or remove data too. We will ignore this sinister scenario for the moment. Unless you are the database owner, you will require some convincing that the data stored in the database has integrity. In many cases this is not a problem as the database owner has the prerogative to manage and report on the data as he or she chooses.
For some types of data, however, this traditional database is not a suitable home, and this is where blockchain comes in. The use case I would like to focus on is voting. Through voting, individuals make decisions (concerning a defined ‘something’) and these decisions are counted as votes which result in a conclusion. What is critical to the voting process and outcome is being able to trust the voting data. If you cannot trust the voting data, you cannot trust the voting outcome, so why bother voting? Now to make the link… voting data can be stored and counted in a database and for the voting process to be successful, this stored voting data must be trusted by everyone who voted and everyone who is impacted by the voting outcome.
One key inbuilt characteristic of blockchain is that the data it stores is extremely difficult to falsify, hack or destroy. In addition, the data’s integrity can easily be verified. Connecting data to the truth.
There are brilliant detailed explanations available online if you are interested in knowing more about how blockchain works. Google is your friend. What follows is intended to be a simple explanation of blockchain for the non-technical reader, showing how its architecture is its strength.
Blockchain broken down
Data within the blockchain is built up in an ordered fashion and stored in units known as blocks. Each block contains:
- the set of changes to be made to the data
- a time stamp of the block
- a reference to the block which precedes it
The third point, the reference to the previous block, is the secret sauce to Blockchain. This reference imposes a strict order on how the blocks connect and relate to each other… a connection of blocks… a blockchain.
Before a change is made to the blockchain, multiple other nodes need to authorise that the change is valid and can be made. The blocks themselves are inherently the audit trail which ensures the data’s integrity. If an attempt is made to falsify the data, (for example change the data within a block or try insert a new block outside of what the rules allow), the blockchain’s other nodes will identify the attempt and prevent the change being made. All this is part of the blockchain architecture, it is not a security layer built on top of blockchain. It is blockchain. In summary, we can trust the data stored in a blockchain. If voting data is stored in a blockchain, we can trust this data too. I may as well add the disclaimer again, that while any technology can be hacked, blockchain is right at the top of the “extremely difficult to hack” category. To put into context, if blockchain technology was hacked, cryptocurrency as we know it today would cease to exist.
Blockchain data exists many times over, on thousands of computers (called nodes) all around the world. There is no single master node. Instead the network of nodes regulates itself using a strict set of rules to ensure that its stored data is up to date, accurate and distributed across its nodes. The benefit here is that the data is not hidden behind the walls of a single authority, where this authority may be tempted to report false conclusions about the data. People outside of this authority can verify that the data is accurate. The other big benefit is that the data stored in a blockchain is pretty much indestructible. If some of the thousands of nodes “goes down”, the system self-regulates to cope with these nodes going down. If new nodes are added, the system self-regulates to cope with this too.
That is my basic explanation completed. Now turning to the future.
The future of blockchain
As with all technologies, it all comes down to how the technology is implemented to meet the needs of the specific cases where it will be used. It has been successfully implemented in the cryptocurrency use-case. Now it is the turn of other use-cases, voting being one example.
Blockchain provides a strong foundation for voting, particularly voting within a company (for example the AGM or during earnings season). If properly implemented, the voting process can be much cheaper to run, recounts will be a thing of the past, the voting results can be trusted to a much higher degree, the confidentiality of the voter will be maintained, and each voter can track their vote to ensure it was counted and not falsified. Sounds appealing, so where do I sign up?
There are a number of companies who already offer blockchain voting, so you can browse around to find an existing provider. At Investis we will be trialing out blockchain voting in 2018, we haven’t started yet, but are looking for suitable companies who are willing to participate in our trial. If you are interested in connecting your business to the future of blockchain please contact email@example.com.