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Blockchain: what is it?

Distributed over the Internet, a “chain of blocks” is an orderly, decentralized and tamper-proof database thanks to cryptography. Each user of a Blockchain becomes a trusted third party. No central organization governs its operation. What reinforce authentication and traceability in many areas.

In the late 1960s, there were Shadoks who spent hours using their Cosmopump to pump cosmogol 999. Today, “miners” spend several hours checking transactions from a block of a chain of blocks “, the famous Blockchain. These blocks contain transactions (write operations in the chain) that are in a specific order.

The best-known use is the Bitcoin virtual currency, the first Blockchain created in 2008. Nine years later, Bitcoin is still being blacklisted by countries or organizations. With a recurring argument: illegal transactions are favored by the anonymity it gives to its users.

Certified transactions

Beyond this controversy, a Blockchain represents an iconoclastic solution. It could “revolutionize” various sectors of activity and in particular all intermediaries “trust” responsible for verifying the identity of a person taking the passage a commission more or less high.

This ordered database makes it possible to certify all the information and make it indisputable. The transaction can be certified by the community, although the challenge is to define in the P2P domain what the limits of this community are. “The integrity of the chain is guaranteed by cryptography. Any changes are detectable by everyone. Note that I said any changes. The channel does not distinguish between “legitimate” or “illegitimate” modification, “says St├ęphane Bortzmeyer (R & D Engineer at the French Association for Internet naming in cooperation - Afnic), on his blog.

Another fundamental principle of a Blockchain: decentralization. The chain is “verifiable by all and controlled by anyone”. When two people wish to organize a transfer of money between them (it may be a payment or a transfer for a family member), they each have a public key and a private one for send and receive money.

Recorded as a computer code, this operation joins others that form a “block”. The latter appears in the giant database of the Blockchain. “All users of the Blockchain have the same registry and each time someone writes something, it is replicated throughout the network,” said Francois Dorleans, director of operations of the French start-up Stratumn, which relies on Blockchain technology to create tools for businesses. It is at this point that the famous “miners” who, like the Shadoks, activate their machine to check the transactions of the block (make sure for example that A has the necessary funds to send to B). The key, a remuneration.

Another singularity, the chain of blocks is public. “Anyone can create an overnight node, which will automatically download and check the channel, with all the data it contains,” explains St├ęphane Bortzmeyer.

Spot false drugs

What applications could benefit from such features? They are very varied, as much general public as professional. In the first case, Blockchain facilitates the transfer of money between individuals. No need to go to a specialized counter, a simple internet connection and a smartphone are enough. Shipping costs are drastically reduced (maximum 1% against 5 to 15%), and usable currency formats are much more extensive. Several start-ups are aiming to “uberise” Western Union and others. Music platforms like Spotify and Deezer as well as record labels could also be concerned: rights management would be done in real time and without going through intermediaries.

But it is the professional applications that should multiply, especially in finance and energy. The establishment of tamper-proof transaction records would be very useful in many areas requiring optimized traceability of objects and products. Food and health could benefit. A health scandal such as horse meat and counterfeit drugs would be limited if not impossible. Good news, because according to the World Health Organization, fake drugs cause 700,000 deaths a year. The French start-up blockpharma is on this niche. Its solution allows you to check instantly via your smartphone the authenticity of the drug box purchased. This enhanced authentication would also be very useful for digital identity (cadastre, banking, transport, birth and death certificates…)

Slow transactions

In Africa, but also in Latin America, many countries do not have cadastres, or at least reliable cadastres. The NGO Bitland has announced the launch of a digital land registry project in Ghana by allowing landowners to survey their land via GPS and register their deeds on a Blockchain.

But a Blockchain is not a panacea either. This solution has some limitations. The main one is its relative slowness (more than ten minutes to record a transaction) and its energy cost (it mobilizes a lot of computers). She is also the target of pirates. If they can not alter the blockchain, they are able to spot vulnerabilities in applications to divert money.

But the impact of these disadvantages seems very small compared to the advantages offered by this decentralized system.

Written on Sep 2, 2018.