This article was originally published in TechRadar.
Even after more than a decade since blockchain has hit the tech scene, many people still display a certain degree of confusion when it comes to explaining this technology and understanding its potential ramifications in industries and the enterprise sphere. Often than not, this confusion escalates when people try to compare blockchain with a technology deeply rooted in the modus operandi of large and small companies alike, namely traditional database systems. To a certain degree, this misunderstanding is justifiable, because a blockchain is, in fact, a database, but a database is not a blockchain. Although both are used to store information, they are not interchangeable as they are structurally and functionally different. A blockchain is a new take on databases referred to as digital ledger that stores information in data structures called blocks. In contrast, databases store information in data structures called tables.
The old Database systems
Traditional database systems function on a client-server network architecture where users known as clients can alter the data which is later stored on a centralized server. Control of a database is attributed to a designated authority, an admin, who authenticates a client’s credentials before granting access to the database. The admin has full control over the database, as such, he can create, modify, and delete any record stored in the database. A major shortcoming of this type of system is related to security. If the security of the authority is compromised, the database can be hijacked and even deleted by the malicious entity that takes control.
Traditional databases are characterized as being recursive, which means that a user can go back and repeat a task on a record and modify or delete it if they have authorization.
When Blockchain comes in
Blockchain is a digitized, decentralized, distributed database, commonly referred to as a distributed ledger that records all the information introduced in the blockchain network in ordered records named blocks. To ensure tamper resistance and data integrity, each block contains the hashed information of the previous block, creating a chain-like structure of interdependent blocks. The created database is then replicated and shared among network participants (nodes) which ensure overall transparency. If a node becomes compromised, the system can recover all the data from full nodes that store a copy of the entire blockchain. In order to add new data in the blockchain the majority of nodes that compose the network need to reach a state of consensus concerning the data that will be introduced. This is achieved through a consensus mechanism which ensures that no malicious data can be introduced in the network.
CRUD vs read and write operation
With the proper authorizations, a client in a traditional database system can perform four different functions on data: create, read, update and write – collectively referred to as CRUD operations.
On the other hand, due to the design of its architecture, blockchains are non-recursive, append-only structures. This means that users can only add more data to a blockchain. Because of the interdependency between blocks, information cannot be deleted or altered in a blockchain without invalidating the whole system. This aspect can act as a double-edged sword. Blockchains maintain an exact historical account of every version of the data in the system, without requiring an administrator to manually backup each version. The downside is that GDPR, and other data protection regulations can pose a problem for blockchain networks if a user decides to enforce their right to be forgotten.
This is not the case for blockchain. The decentralization mechanism allows a blockchain-based infrastructure to have no single point of failure, no centralized server. Data is hosted and maintained by all the parties involved in the business flow. In this case, decentralization translates to increased security and transparency.
Traditional database systems rely on a central server to host and store all the information. This type of architecture has become somewhat of a liability as it creates a single point of failure that can be exploited by attackers, either through brute computational strength or by searching for a back door.
Tamper resistance and data integrity
Software products based on a blockchain database are able to demonstrate data integrity and the fact that the data was not changed or altered by third parties. Any changes are recorded and logged properly, thus software products users receive guarantees about data integrity. The majority of centralized databases create backups up until a particular moment, similar to a snapshot of a moment in time. Blockchain maintains a full historical record of itself. Once data is introduced in a blockchain, it is almost impossible to remove or alter. As such, they provide an ideal tool for storing and analyzing corporate information. Furthermore, the layer of transparency enables users to observe and analyze how the blockchain has changed over time.
A blockchain backend is a network of computers where each is storing applications, immutable data, and product functionalities. Distribution adds a new layer of utility and value to enterprise software products because it guarantees availability and fast access to the system.
Source code immutability/integrity
Applications can be implemented in a blockchain environment directly as source code, which can’t be altered, without anyone becoming aware of the changes. In the same manner, source code immutability ensures a high level of trust between software users.
The concept of blockchain emerged from the need for a secure and stable framework. Bitcoin, the first implementation of the technology was designed as a digital payment system. As a result, security, cryptography, and data protection are core features of this technology. All of blockchain’s inherent properties come together and make a secure environment.
Modex BCDB is a new take on blockchain technology which removes the need to invest resources in blockchain training and facilitates fast adoption of the technology in businesses. The solution proposed by Modex is a middleware that fuses a blockchain with a database to create a structure that is easy to use and understand by developers with no prior knowledge in blockchain development. As a result, any developer who knows to work with a database system can operate with our solution, without needing to change their programming style or learn blockchain.
Currently, the majority of blockchain solutions present on the market are oriented towards blockchain as a service, limiting themselves to a rigid view and application of the technology. A company or the CTO of a company can come to the realization, after a bit of study that their business can solve several issues and streamline back-end processes by implementing blockchain. The problem is that in order for a company to implement blockchain technology only through its own tech team, they need to invest a significant amount of time and resources to study what type of blockchain is most suited for their needs, and commence a lengthy process of learning the development specificity of the respective blockchain, as well as scouting for developers proficient in the technology.
Modex Blockchain as a Database (BCDB) was designed to help people without a background in tech, access the benefits of blockchain technology and remove the dangers posed by the loss of sensitive data. With minimal changes, Modex BCDB can transform any type of database into a decentralized database which holds the same valuable characteristics inherent to blockchain technology: transparency, increased security, data immutability, and integrity.
Every enterprise is reserved and unwilling to make changes to its database, and for good reason, as data loss or data corruption constitute major risks. Modex BCDB doesn’t work by deleting the existing database, or data entries. The database is maintained intact throughout the process, data integrity is ensured by calculating the metadata of the records and storing it on the blockchain. Moreover, the system does not restrict access to the blockchain or to the database, so when a developer needs to make a reporting or ETL transformations, they can always perform warehouse analytics by accessing the database directly. This is because Modex BCDB has been purposely designed to be agnostic. With our solution, clients are able to set up a network, regardless of the type of database employed. In a consortium, each company can maintain what type of database they prefer (Oracle, Microsoft, IBM, MongoDB), and connect them through a blockchain-powered network to ensure cohesion, availability while protecting corporate interests.