Do you know how to record data on a computer? Any info on the system? In the genre, they are stored in an encoding format that can be represented as a large table, in which columns and rows allow data to be stored and retrieved. This data can be on your computer, on a private network or in the so-called cloud, but they are necessarily arranged somewhere, in some way.
In blockchain, by removing the association of technology with digital currencies, what remains is simply a database. However, unlike the one you use to store information on your system or your company’s system, it is replicated throughout the network it’s on. Your and my information, when published in this bank, on this same network, is equally accessible to you, me and anyone else on the same network. This, above all, guarantees the public, with the fact that everyone can constantly monitor everyone.
Another difference present in technology compared to traditional banks is the fact that data is not deleted or replaced. Instead, they are considered spent, but the history of their creation is preserved. That is, if a certain item was mine – and it was registered online – and became yours, my ownership is retained (even if it is marked as spent), and the new owner is registered as current and valid information, both for me and for you and anyone else on the same network.
In addition, all current transactions are regulated by the so-called smart contracts. Pre-set and automatic rules that appear when certain conditions are met. For example, imagine that the property that is registered as yours in this network, upon your death, automatically passes to your wife. Once the set condition is met, the new ownership takes place automatically, without sharing, lists or any additional bureaucracy.
In this universe, there is also self-regulation of the network itself, which happens, for example, with digital currencies, such as bitcoin, where each transaction is confirmed by confirming that the same record is identical in at least 50% plus one of the network’s participants. Therefore, the ability to authenticate any entity (such as a government or institution) is transmitted to the entire network.
In short, blockchain is a technology that creates a network where there is maximum transparency, governed by automatic smart contracts and self-regulated by the network members themselves. It can be public or private.
When you think of blockchain and bitcoin, you think of a public network; in theory, open for use by all. However, there are also networks that have the same characteristics, but the intermediary allows or does not allow them to participate, the so-called permissioned networks.
The idea here is to form a network that integrates parties with a common interest, as Carrefour did to simplify and better control its European logistics network. Here the transparency between the parties remains and the validity of the contract as well, but the regulation remains limited to the “owner” of said network. This way, there is no need to check if the data is available on 50% plus one of the machines, but for the network manager to understand that it is valid.
In this mode, you, me, and a third party could be on the same network, but I would only see your data, not the third party’s data. This one would see only my data, not yours, as a connected network between us, which limits the area of participation of each of them.
There is no doubt that this record format is here to stay and will revolutionize, for example, the world of contracts and transaction records. However, it will have to develop even more as a tool.
First, the limit to the reach of your solutions lies in the network you choose. For example, in this technology it is possible to establish a value for an image, such as a drawing of a little monkey, and make it unique and individual – this is how NFTs (non-fungible tokens) work – by controlling the number of times it is reproduced and allowing royalties to be recorded for its actual owner, copyright holder, but only if this happens within the network on which it is registered.
Yes, the blockchain is not a unique place, and neither are similar metaverse-style ideas. There are several public options and many more private ones. In the case of private companies, this limitation is not a problem. After all, the logic of use already starts from the idea that it is not available to everyone.
But, for example, it does not function as a guarantee that there will be no misuse of the monkey image or any other intellectual production by third parties. Nothing prevents this creation from continuing to circulate freely and unchecked through the open world and free information like the Internet.
Second, when using public networks, and even private ones, we have, in addition to the benefit of the public, the risk of exposing personal data protected by the General Data Protection Act (LGPD) and the Federal Constitution itself. Therefore, if this data is placed there, there is no way to delete it.
A solution with this technology for medical records would be fantastic, wouldn’t it? Guaranteed evolutionary record of care, consultation and examination for doctor and patient in a unique, indelible and reliable way. However, it would also forever expose the patient’s personal and sensitive information, exposing the doctor, clinic or hospital to all the heavy responsibilities that the law imposes on the controller of that information.
Finally, we have a true blockchain guarantee of the correctness and veracity of its records. As stated before, in public networks this is done by complex mathematical calculations performed by so-called bitcoin miners, for example, guaranteeing a fraction of the transaction value to themselves just to confirm that the correct protocol is used and to confirm the validity of the registration; to be in the verification of more than half of the computers in the network a real confirmation. This is interesting and challenging on an open network, but relatively easy to get around on a private network.
In the first case, the size of the network and the complexity of the calculations that need to be made are getting bigger and consume more and more computing power and electricity; in the second, the advantage of self-regulation ends up being replaced by an existing entity guaranteeing the validity of the record, which can be much more easily circumvented. Changing the public network would require hackers to work together to attack more than half of the participating computers. There would be much less effort in the private sector.
Although limited or perhaps in a future version more advanced than the one available today, this technology will govern and be present in our contracts in the future, records of physical and digital ownership, and perhaps even in the daily act of consuming any product, and must be the cornerstone of warranty and fees within the digital universe, coexistence and consumption committed to the future.
Because of all this, I believe that the level of people’s effort to assimilate and use the tool is still low, which could mean a significant loss of opportunities associated with the pioneering spirit that is so present in the world wide web or in the reality of the world of innovation. In other words, we are faced with a universe of possibilities to be explored and tested in different hypotheses, with no guarantee of return invested here, but with great possibilities of gain if the ideal “vein” is identified.