Blockchain through Cryptography
technological advancements in the last 30 years humans have progressed farther and
faster than in any rate previously in history. Ever since the invention of the
internet the world has been connected in ways it could have never imagined. The
way of interacting with each other has evolved, but human nature remains the
same. Just as the ancients would have to encrypt important messages, i.e. cave paintings,
hieroglyphs, modern humans still need safe passage of their information but
through the medium of the now complex and unsafe web of the net. Cryptography
has been around for as long as the first civilizations, but its application and
relevance in the modern world today will be vital in everyday life.
Encryption is the process
of converting messages, information, or data into a form unreadable by anyone
except the intended recipient. Encrypted data must be deciphered, or
decrypted, before it can be read by the recipient. The root of the word
encryption “crypt” comes from the Greek word kryptos, meaning hidden or secret. Throughout
history humans have been protecting their messages for a variety of reasons.
The Assyrians and Chinese were interested in protecting their trade secrets.
Germans were interested in protecting their military secrets.1
And as computers and the internet grew it soon became evident for governments,
corporations, and the everyday person that the method to conceal had to evolve.
cryptography includes the use of mathematical algorithms, hashes, ciphers that
are done on a network of computers. Ciphering and hashing has gotten more
Cryptographic hashing is a complex
mathematical function that forms a stream of data into a random output of fixed
length. The same input string will always produce the same output string but if
the input string is changed by even a single character then the output string
will be entirely different. Hashing is a one-way encryption and cannot go
backwards on a hash to the original string, only forwards, this is good for
strong passwords, instead storing the actual password, the hash of the password
is stored, when a user enters that password at login it is hashed and compared
to the hash in the database. If they’re the same then the login is successful, this
way if an attacker gain access to a database they’ll only have the hashed
passwords which will be of no use to them because they won’t be able to go
backwards to figure out the original password.
Symmetric encryption relies on the use
of a key which is known to both the recipient and the sender an encrypted
communication. This is the most basic kind of encryption that involves only one
secret key to cipher and decipher information. Symmetrical encryption is an old
and well-known technique. It uses a secret key that can either be a number,
word or a string of random characters. The sender and the recipient should know
the secret key that is used to encrypt and decrypt all the message. The main
disadvantage of the symmetric key encryption is that all parties involved must
exchange the key used to encrypt the data before they can decrypt it. Symmetric encryption handles a
greater volume of data in each time. Speed and efficiency also gain from the
same key being used by both parties to encrypt and decrypt.
is an improved method compared to symmetric encryption. Someone with a secret
key can decrypt the message so asymmetrical encryption uses two related keys to
boost security. A public key is used for anyone who might want to send a
message. The second private key is kept a secret so that the sender can only
know. A message that is encrypted using a public key can only be decrypted
using the private key. Security of the public key is not required because it is
publicly available. Asymmetric key is much better in ensuring the security of
information transmitted during communication. It’s because limitations of
symmetric encryption that asymmetric techniques are used to encrypt the keys
before they’re sent. The private and public keys used in asymmetric encryption
are more sophisticated, this method is better for covering key exchanges, but it
imposes greater loads on processors, memory, and electricity.
is even more in the forefront today with newer technologies such as blockchain.
This technology will avert power away from centralized authorities communications,
business, and politics. Blockchain is a decentralized and distributed digital ledger that is
used to record transactions across many computers so that the record cannot be tampered
without the tampering of all subsequent blocks. It provides a way to record and
transfer information that is transparent, safe. It is managed by a peer to
peer network collectively adhering to protocol for validating new blocks.
The first blockchain was invented in 2008 by
an anonymous person known as Satosho Nakamoto and implemented in 2009 as a
main component of bitcoin, a virtual currency, where it serves as the
public ledger for all transactions. Bitcoin uses the Sha hash function,
the backbone of the bitcoin network.
A blockchain database consists of two kinds of
records: transactions and blocks. Blocks hold batches of valid transactions are
hashed and encoded. Each block includes the hash of the prior block in the
blockchain, linking the two. The linked blocks form a chain. This process
confirms the integrity of the previous block, all the way back to the original
block. Sometimes separate blocks can be produced simultaneously, creating a
temporary fork. A “hard fork”
is when a blockchain splits into two separate chains because of the use of two different
sets of rules trying to manage the system, blockchains prevent two transactions
from spending the same single output in one blockchain.
Most financial companies have not prioritized
decentralized blockchains but soon will as CME Group, world’s leading and most diverse derivatives marketplace that offer a wide
range of futures and options products for risk management will begin trading bitcoin
futures. What one large financial firm does others follow.
Industries Worldwide will be changed because
of the blockchain technology. It can be used to give access to financial
services to everyone around the world, like those in third world countries who
do not have access to banks. Bitcoin
allows anyone to send money anywhere in the world instantly and with low
fees.2 Blockchain can be used to create decentralized versions of
peer-to-peer ridesharing apps, allowing both car owners and users to arrange
terms and conditions in a secure way without third party providers.
on a centralized server is vulnerable to hacking, data corruption, or human
error. Using blockchain technology allows cloud storage to be much more secure
and robust against any attacks.
In cyber security, the blockchain ledger is
public, the data is verified and encrypted using advanced cryptography. It is much
less prone to being hacked or altered without permission.
Government systems are particularly
slow, non-transparent, and prone to corruption. Putting in blockchain-based
systems can significantly reduce status quo, increase security and efficiency
of government actions.
one of the most important areas of society that the blockchain will change is
voting. In politics, certain parties were accused of rigging election results.
Blockchain technology can be used to register voters and verify identities. And
electronic vote counting ensures that only legitimate votes are counted, and no
votes are changed3.
cloud storage, data on a centralized server is vulnerable to hacking, data
loss, or human error. Blockchain technology allows storage to be more secure
and robust against attacks
conclude, centralized data is more controllable and have been for many years, but
information and data manipulation are very common. By decentralizing it,
blockchain makes data transparent to everyone involved. Transactions are
broadcast to the network using software, potentially leading to a
reduced role for one of the most important regulatory entity in society, the
middleman. Just as decentralization communication systems lead to the creation
of the Internet, today the new technology, the blockchain, has the potential for
newer decentralization of stored data and managed information.