update 19 August 2021

How Data storage will Change with Blockchain

It is often forgotten that one of blockchain’s roots comes from Yuji Ijiiri’s breakthrough in 1989: triple-entry accounting. To understand what this means, let us take a step back and understand this hot topic’s history.

Originally, there was a single-entry bookkeeping. Records were documented in a central book allowing kings and queens to manage their finances and build their empires. Whoever was in charge of the book had to be trusted by their superior since they could easily cook the books for their own benefit.

Then came double entry-accounting, the system used by banks today. It involves recording a debit on one account and a credit on the other. In this case, trust is placed in an institution instead of a person.

In both these instances, however, trust in an intermediary is required. This is where triple-entry accounting comes in, relaying that trust to the network itself – no intermediaries. Instead, a single truth can be established in a distributed fashion where all ledger entries are published on the shared record (the public record being the third-entry). Trust is transferred from an institution to a network.

Bob’s credit, Alice’s debit and the blockchains record constitute the triple-entry system

Now, Bitcoin is the first mainstream application employing triple-entry accounting. Transactions between addresses are recorded on the shared ledger (blockchain). Interestingly, anything can be encrypted as a piece of data and published on the blockchain, from marriage certificates to property to music. Accordingly, a blockchain is a distributed form of data storage.

So how does data storage change on a blockchain-based system?

Firstly, there is increased security and immutability. Immutability is the feature of being unchangeable, drastically reducing the probability of data loss, theft, and manipulation. This will benefit industries across the spectrum since every organization has stores data, be it employee. However, blockchains will especially benefit those whose value proposition lies in data storage, such as public records, the internet of things, and cloud computing.

This leads to the second benefit, tracking ownership. Leveraging the property of immutability and asymmetric cryptography, blockchains will reshape the digital rights management industry. For example, UJO is an oft-quoted player in the music industry who permanently stores music rights, allowing the artists to manage licensing on their own terms using smart contracts (removing the rent-seeking record labels from the equation).

Thirdly, it gives the individual more privacy. This is because blockchains can demonstrate ownership without revealing the data, which can be done using various methods, including zero-knowledge proofs, proof-of-existence, and sharding. Not to mention that blockchains introduce innovative ways to store data in a decentralized way adding to privacy (and security).

Btc
Bitcoin
$47.477
price
0.93092%
price change
BUY NOW

However, many challenges lie ahead before the mainstream recognition of blockchain-based data storage systems. Blockchains still have a long way to communicate interoperability, making the migration of data from one platform to another quite difficult. Moreover, blockchains are still at an early stage of development where the adoption process is slowest, and network fees still quite unpredictable.

More posts

How Many ETH Will Burn After the London Fork?

Since its launch in July 2015, Ethereum has grown exponentially to be the second leading cryptocurrency in market value after Bitcoin. The platform’s growth has primarily been attributed to its smart contract feature, which powers the deployment of a wide range of applications, including oracles, decentralized finance (DeFi), decentralized exchanges (DApps), marketplaces, crypto-collectibles (NFTs), and developer tools.  Despite its growth, Ethereum faces numerous challenges that hinder its usability. The scalability challenge is one of the biggest ones that Ethereum faces. The current state…

The Impact of Adoption of Cryptocurrencies on E-commerce Business

E-commerce is the short form of electronic commerce. It is the buying and selling of merchandise over the internet networks. It also involves the transfer of funds and the keeping of records to certify the transactions made. E-commerce is of three types; business-to-consumer (B2C), business-to-business (B2B), and business-to-government (B2G). The main reason for using cryptocurrencies in e-commerce is to get rid of third parties that control the transactions. This relationship can make online shopping much easier and safer since blockchain technology that backs up cryptocurrencies is…

What it Means to Make Bitcoin a Legal Tender

June 9, 2021, marks the first move that would make history in Bitcoin's timeline. El Salvador passed a bill where 62 of 84 congressional voters would make Bitcoin a legal tender. Fast forward to September 7, and El Salvador became the first country to make Bitcoin a legal tender. In this article, we shall look into what it means for Bitcoin to be a legal tender in detail; What is Legal Tender? "This note is legal tender for all debts, public and…

The Correlation Between Blockchain Activity and Transaction Fees

Miners and validators are essential cogs in any crypto project. They're the ones who process transactions on a blockchain (BC) activity. For their efforts, crypto projects compensate them for their efforts from transaction fees. A transaction is only valid when it has undergone validation. The process ends in the validators adding it to the BC. Mining consumes a lot of computing power. As such, it's an energy-intensive exercise. The motivation for the miners is the block reward that consists of…

Understanding Shrimpy’s New DEX Trading Feature

DEX trading is one of crypto's newest but also most complex investment options as of late. Decentralized exchanges are trustless peer-to-peer (P2P) trading environments relying on smart contracts that help facilitate crypto exchanges. The clear benefits of DEX trading are security, anonymity, and greater user control. Although decentralized exchanges, and DeFi as a whole, have gained immense popularity over the past two years, the segment is still considered new by many in the community. A large chunk of crypto investors still does not feel…

Why Do Exchanges Freeze User’s Crypto Funds?

cryPicture this: you've finally mustered the courage to take the plunge into crypto. Everything is going right for you. You're mastering the hacks to optimize your investment and are looking forward to a fulfilling experience within the space. Then it happens. You log in to your account and find that you can't access it anymore, let alone transact in it. In a panic, you try customer support to no avail. Next, you can't help asking how you got here. Is it…

Determining the Initial Value of Cryptocurrencies

It is quite obvious that the total market cap of cryptocurrencies has enjoyed impressive growth since their inception. It was able to hit the magic $2trn figure, standing at $2.064trn as at the time of writing. That is close to 2.5 times the value of crypto at the start of this year, 2021, as per coinmarketcap data. While all these huge figures are truly impressive, things haven't been like that. The increased market capitalization has been more of a result…

Factors Driving the Price of a Crypto Project to Skyrocket

Cryptocurrencies continue to showcase outstanding crypto performance since the launch of Bitcoin in 2009. Global investors are looking forward to establishing financial stability with digital assets. Due to the growing interest, crypto prices are making a drastic shift to the top.  Still, in some scenarios, the market trend keeps decreasing for specific periods. A coin's bearish momentum creates fear and panic for users who believe in the future of the asset.  The opposite is a bullish market that records skyrocketing prices of…

Vivid Indicators of a Bull Run in the Crypto Market (Bull Market)

In the cryptocurrency space, a bull market is one whereby the prices are expected to rise significantly or are rising. Due to the volatile nature of crypto, the term “bull market” is reserved for more extended periods characterized by the rise of a large portion of the prices. To be categorized as a rise, the price must be up 20% after two declines of 20% each. There is optimism, expectations of solid results, and investor confidence in a bull market,…

Historical Hardfork Events Every Crypto Enthusiasts Should Know About

Blockchains have been gaining attention since the history of crypto. The highly advanced systems help decentralize and streamline financial systems globally. As the blockchain systems grow, investors start noticing issues and propose an upgrade. However, for any upgrade to occur, blockchain requires the consensus of all participants. If there is no consensus, two factions with opposite ideas may form. The developers may choose to go ahead with the upgrade but maintain the status quo in the original chain. At that point,…