Blockchain Transparency Explained
One of the most appealing aspects of blockchain technology is the degree of privacy that it can provide. However, this leads to some confusion about how privacy and transparency can effectively coexist. In this segment we will explore how blockchain balances the two concepts to the benefit of users.
On a blockchain, the identity of a user is concealed behind powerful cryptography, meaning that linking public addresses to individual users is particularly difficult to achieve. This raises questions about how blockchain can be regarded as truly transparent.
The transparency of a blockchain stems from the fact that the holdings and transactions of each public address are open to viewing. Using an explorer, and equipped with a user’s public address, it is possible to view their holdings and the transactions that they have carried out. This level of transparency has not existed within financial systems before, especially in regards to large businesses, and adds a degree of accountability that has not existed to date. In the past, large financial institutions were able to use their customers funds as they saw fit, without anyone’s knowledge, and not always in the most effective or honest matter, the financial crisis of 2008 being the epitome of this very issue.
It is in this way that blockchain gives large businesses a platform to act with genuine integrity towards their community and customers. However, blockchain has the potential to add transparency not only to the financial aspect of business.
For example, one of blockchain’s foremost use cases is within supply chain management. The technology can allow for the immutable tracking of anything across the supply chain. This means that consumers can know exactly what their food contains, whether it is organic and fair trade, whether their goods are genuine or produced with respect to workers’ rights. This is not only beneficial to the consumer, in that they can be absolutely sure about where products came from and what they contain, but also to the company producing the products. Such transparency helps to maintain the integrity of a company by reducing scandals in production, such as a reliance on sweatshops to produce cheap clothing, for example.
This has further implications than simply consumer goods as it can assist with tracking of crucial substances such as medicine, ensuring patients receive real medications and halting the huge counterfeit market.
Blockchain technology also has the power to improve healthcare by providing a secure database allowing patients to safely access their medical records when they need it most. Whereas now it is a problem to do so, especially when abroad, blockchain removes this issue by creating a decentralized database for increased security and distribution. In a similar way, a blockchain ledger can also be used for mediating drug intake and distribution, regulation compliance or managing healthcare supplies. For example, an individual patient could interact with a specific blockchain healthcare platform in order to easily view all of their claims, medical history, transactions, as well as overdue payments.
Such a database has never existed before and has the power to revolutionize everything from low-level food production all the way up to governance and voting. The powerful combination of security and immutability that blockchain provides means that unfair elections, voting fraud and a lack of integrity can be eliminated. Blockchain achieves all of this through a traceability of information as a means of ensuring that nothing is unduly tampered with, dishonestly added or removed.
The applications of developing such a system of integrity are limitless and blockchain is the technology that is underpinning this shift to a more transparent and positive society. This goes further than creating a world of trust, instead giving a platform to trustless paradigm, one where trust is not even needed as the system itself is immutable and incorruptible.
Why Is Blockchain Trustless?
Blockchain technology provides a spectrum of revolutionary benefits. When combined, these values of security, decentralization, privacy and transparency offer the most profound quality of blockchain: trustlessness – a model that does not require trust to safely interact and transact.