Don’t we all know about Bitcoin? We certainly do. But what core component of it makes it so secure and reliable that the price of Bitcoins has skyrocketed to $4.3k from a meagre $0.3 in 2010? It is the Blockchain.
Conceptualised by Satoshi Nakamoto, it was implemented in 2009 as a core component of the digital currency bitcoin, where it serves as the public ledger for all transactions. Blockchain is a growing list of records, called blocks, which are linked and secured by cryptography; what it does is that it connects information and allows total transparency. By the use of a hash point, timestamp and transaction data, two adjacent nodes are connected. The above makes it really difficult to change information on any node. Bitcoin is a digital currency not supported by any central bank or government. It has the power to make a transaction virtually untraceable. Its core component, Blockchain, essentially uses the same technology for creating permanent records that are impossible for anyone to edit. A bitcoin Blockchain is designed to transact with crypto currency and is open to the public. This means that anyone can join and view any transaction ever happened on the network.
Today your data is stored in silos (like sharing word file), but with block chain your data will be stored publically or pseudo anonymously in a shared database. For example, you can crack the chronological history of the organic cotton shirt that you bought. It cannot be tampered or modified because everyone using the system is watching. Blockchain helps in mapping a products journey across the supply chain revealing its true origin and touchpoints. This increases trust among the consumer community.
GST, Goods and services Tax, is also looking up to the Blockchain technology. It eases the working and allows regulation of transactions, agreements and contracts that are distributed across several hundreds or even thousands of computers around the world. This technology is safer than the present system of data management used by the Tax department as distributed ledgers are inherently harder to attack. Also, there are multiple shared copies of the same database. So, a cyber-attack would have to attack all the copies simultaneously to be successful. Thus, use of Blockchain in GST process makes it faster, transparent and easily accessible to the users.