Blockchain: Fish to Pharma

The popularity of blockchain continues to be on the rise. Hundreds of articles have been written about the subject. But what is blockchain, and is it truly capable of changing the world? Popular terms describing blockchain include digital transactions, distributed ledger, secure & trust network – but what do all these descriptions actually mean? Most of us today identify blockchain with cryptocurrency, but the base technology has nothing to do with financial transactions. Blockchain, stripped down to bare bones, is a way to send and receive data without a third-party in a secure manner.

Linking blocks: Blocks contain three main elements: data, hash, and the hash of a previous block. In the case of cryptocurrency, the block data contains financial information including the currency amount. The hash is the unique identification tag of the block. Every block also contains the hash of the previous block, serving as a secure link between the two blocks – similar to a person’s DNA structure. The block cannot refute its hash, nor the hash of its predecessor. Every chain begins with a genesis block, containing data that establishes protocol, content and processing parameters for the entire chain. Genesis blocks do not include any hash except for their own.

Securing blocks: The security, scalability, and the ability to serve as a solid base for system alterations are what make blockchain such an attractive technology. Blocks contain timestamps - the documentation of stating when information was altered or created. Timestamps are useful for tracking vast quantities of data in real time. Another component of the chain is Merkle trees, also known as hash trees. These trees permit the secure processing of different layers and sizes of data within each block. It’s no wonder the Supply Chain industry views blockchain as a valuable technology to use as a foundation for developing their platforms. Smart contracts are an example of applying the blockchain technology towards digital documentation. Contracts are digitally processed and documented in real-time by implementing blockchain technology to record data in a secure manner.

Updating blocks: For example, altering the content of a block changes its hash identification. All of the proceeding blocks, therefore, become void because they no longer contain the hash of the previous block. A second way of securing the chain is through showing proof-of-work before the creation of every new block. Previously applied to many applications including preventing DoS attacks and blocking spam email, Proof-of-work serves to provide factual verification for every block in the chain. The third and possibly most important way of delivering blockchain security is through distribution. The peer-to-peer network contains a full copy of the chain to each peer in the system, requiring every node (computer) in the network to have identical copies, thus balancing the ledger. Every time a new block is created, each node receives a copy of the block and verifies the validity of the content before the block can be safely added to the chain. Blocks deemed as invalid by the P2P network will not have the approval to join the chain.

Cannabis is a hot topic to unite with blockchain. New ventures are creating Initial Coin Offerings (ICO’s) to serve as a form of currency for processing cannabis transactions. The purpose of such explorations is due to the lack of positive response from the banking and credit industry to back the legal cannabis trade. This forces the use of cash on most transactions. Another reason for applying blockchain to the cannabis industry is for supply chain monitoring and compliance. With the possibility of cannabis becoming legal in multiple states within the next few years, blockchain will serve to ensure that the plant is legally sourced, safely produced, distributed and paid for legitimately.

Big Pharma is looking into ways to save money on their supply chain and pass new clinical trials for next generation drugs using blockchain. Companies like Embleema are looking to secure EMR (electroinc medical records) and while staying HIPPA compliant.

In today’s world, we use tracking numbers to find package locations. We are sent emails regarding the status of an item ordered online. But imagine being able to know much more about the logistical details concerning items in transit. A great example is taking place right now in the fishing industry. At the beginning of 2018 the World Wildlife Fund in Australia, New Zealand, and Fiji partnered with technology companies Consensys, Traceable, and Sea Quest Fiji Ltd. to make a pilot program utilizing blockchain technology to track tuna fish. The goal is to stop illegal fishing ventures who violate human rights by practicing slavery and illicit trafficking on their boats. Applying blockchain to any food group will enable customers to know the entire journey of any food they eat – starting from the sourcing of seeds and planting to ending up on a dinner menu. Other industries including medical, legal, and finance have been buzzing about how blockchain improves tracking abilities, closing the gaps where information is lacking in their supply chains.

It sounds cool that blockchain improves incremental reporting abilities from both B2B and B2C perspectives, but what’s the payoff? Learning microscopic details from blockchain will enable analysts to discover what costs most in a company’s value chain. Because data is equally distributed and secure, assumptions are formed around valid information. 

Blockchain will make it a lot harder for people to hide information or fabricate data. Investing in the technology may seem expensive at first with an extended payback period, but in the end, will simultaneously cut costs and streamline processes in organizations.

In short, blockchain is NOT a replacement solution to your current technology issues. Yet, it is a valued add-on to your existing systems for audit trails and compliance needs.

Sources:

• https://www.computerworld.com/article/2588287/networking/networking-peer-to-peer-network.html
• https://www.webopedia.com/TERM/B/blockchain.html
• https://www.fintechweekly.com/blockchain-definition
• https://www.investopedia.com/terms/b/blockchain.asp
• http://theconversation.com/how-blockchain-is-strengthening-tuna-traceability-to-combat-illegal-fishing-89965
• https://medium.com/taipei-ethereum-meetup/beginners-guide-to-ethereum-3-explain-the-genesis-file-and-use-it-to-customize-your-blockchain-552eb6265145
• https://markets.businessinsider.com/news/stocks/embleema-launches-the-first-health-records-blockchain-to-give-patients-complete-control-over-their-health-data-and-be-at-the-center-of-clinical-research-1027379454

Robert Endo is the founder and Engagement Manager of Intrepid Data.

Intrepid Data is a full-service developer that builds platforms for web-based applications