{"id":1014,"date":"2020-10-27T16:00:00","date_gmt":"2020-10-27T20:00:00","guid":{"rendered":"https:\/\/www.pwvconsultants.com\/blog\/?p=1014"},"modified":"2020-10-27T15:40:04","modified_gmt":"2020-10-27T19:40:04","slug":"blockchain-explained-how-it-works","status":"publish","type":"post","link":"https:\/\/www.pwvconsultants.com\/blog\/blockchain-explained-how-it-works\/","title":{"rendered":"Blockchain Explained: How It Works"},"content":{"rendered":"\n

Blockchain, distributed ledgers and cryptocurrency are not interchangeable terms. Blockchain has to happen in sequence and partially helps provide data integrity.<\/h2>\n\n\n\n

Often, people misconstrue what blockchain is. The term \u201cblockchain\u201d has been co-opted. It is not cryptocurrency. Cryptocurrency uses blockchain. There are a number of elements to blockchain, which is sometimes also confused with a distributed ledger. To start, let\u2019s discuss how blockchain and distributed ledger work together for an effective security strategy.<\/p>\n\n\n\n

As crazy as this sounds, blockchain is exactly what it sounds like. It\u2019s a literal chain of blocks. This chain of blocks only fits together in one specific way, providing a security benefit.<\/p>\n\n\n\n

Let\u2019s back up a little. Everything in security deals with CIA: Confidentiality, Integrity and Availability. Confidentiality refers to keeping information protected from people who don\u2019t need access to it. Availability refers to being able to locate that data when you do need it. Integrity is different, this is typically an assurance from your provider that your data hasn\u2019t been tampered with. It\u2019s AWS<\/a> or Microsoft Azure<\/a> or whichever provider you choose to secure your data (we implore you to use cloud services) saying that your data is safe, it\u2019s duplicated, unaltered and untouched. However, aside from their assurances, there\u2019s no 100% way to know for sure if anything has been tampered with.<\/p>\n\n\n\n

For example, a hacker could potentially access and tamper with data in a database, give themselves a million dollars, tamper with the logs to remove evidence that those changes were made and that they were in the system, and get  back out.<\/p>\n\n\n\n

Enter blockchain. This literal chain of blocks only fit together in one specific way, which is confirmed as each block is added to the chain. When a block is added, there is a chain of data pieces that are hashed together to reduce large sets of data down to a determinable alphanumeric string of determined length that is incredibly unlikely to be duplicated. This string of data can be simply a couple of words, or it can be as long as War & Peace and anything in between. Because of the way it works, when you hash data together, getting the same result twice is rare. So, if you take all the data and data records and hash them together, those hashes have to fit. If someone tampers with one of those records, or even just the last two records, they have to re-hash the data and it\u2019s unlikely to match the rest of the hashes.<\/p>\n\n\n\n

Yes, there are different ways to hash data. You could hash everything that\u2019s been in the database or you can hash the last block with the block before it. The former is more cumbersome than the latter, but they both serve the same purpose.<\/p>\n\n\n\n

But what if someone goes into the blockchain and hashes and tampers with the record that was preceding it as well as the current record they want to mess with and then alters the hash? Well, there\u2019s another piece to how blockchain is usually implemented. This element distribution makes distributed blockchain an effective superset of distributed ledger. On its own, blockchain would not be hyper-effective because of the example above.<\/p>\n\n\n\n

This is why blockchain needs distributed ledger, which is a whole other topic that we will dive into in the next article. <\/p>\n\n\n\n

One key thing to remember about blockchain is that you don\u2019t need to use it for everything, nor should you. There are practical use cases, which include transactional exchanges and semi-transactional contracts which need to happen in a specific order. Blockchain needs to happen in sequence, so applications that do not have a set order will not work. Blockchain is a tool, it\u2019s not the whole toolbox. Tomorrow, we discuss how distributed ledger and blockchain work together to create an effective security strategy for specific operations.<\/p>\n","protected":false},"excerpt":{"rendered":"

Blockchain is a term that is often misconstrued. The way it is designed and functions makes it helpful in certain security protocols.<\/p>\n","protected":false},"author":1,"featured_media":1024,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[4,14],"tags":[1923,602,1925,1926,1822,1831,1273,1924,575],"yoast_head":"\nBlockchain Explained: How It Works - PWV Consultants<\/title>\n<meta name=\"description\" content=\"Blockchain is a term that is often misconstrued. 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