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WHAT IS THE BLOCKCHAIN?

Blockchain is the technology behind cryptocurrencies, invented by Satoshi Nakamoto and made public between 2007 and 2009. It is not known whether Satoshi Nakamoto is actually a person, a pseudonym or rather a working group made up of various individuals.

Blockchain is a public, open, shared and unchangeable digital ledger that photographs the status of any assets and transactions (between the members of the blockchain) that concern the assets in question. Entries in the blockchain do not require to be validated by intermediaries, but consensus is reached in one peer-to-peer logic.

THE GUARANTEE OF MEDIATORS

If we think of the exchange and registration of assets in daily life, these take place thanks to the intermediation of figures or institutions that guarantee the mutual trust between the subjects involved in the transactions, and therefore their validity.

Central banks, for example, guarantee the value of our money: when someone pays us with a banknote, we accept it not because we trust whoever gives it to us, but because we trust the central bank that issued it. Again, when we buy a house we trust the notary and the land registry, not the seller. Or if we take a house or a car with Airb & b and Uber respectively, we rely on the platform and not on the individual lessor or driver.

The presence of these brokerage bodies it is fundamental for the functioning of the modern economy and society, but it is not without costs: think of the enormous size of the bureaucracy, the economic cost, the lengthening times, the lack of transparency of the intermediate bodies, the lack of control by of citizens on banks, platforms and bureaucratic bodies, and the risk associated with centralized databases.

A SYSTEM WITHOUT INTERMEDIARIES

Blockchain promises to solve all or most of these problems through the creation of a public, open, shared and distributed digital ledger of assets and transactions.

In a Blockchain chain, all participants can support transactions without the need for intermediaries, everyone can transcribe them on the public register - subject to validation by the same members - and everyone keeps a digital copy of the register. This effectively eliminates the presence of intermediaries and makes all the transparent process.

For example, if I have to pay 10 euros to Franco, I can start a transaction of the corresponding value on the Blockchain. The software automatically checks that all the conditions of the protocol are met (trivially and by way of example: that I have the 10 euros in my wallet, that I have signed with the correct private key, and so on) and provides that the transaction is carried out and recorded in the next block of the electronic register.

HOW DOES BLOCKCHAIN ​​WORK?

The four keywords of the Blockchain are:

Cryptography

The status of assets and transactions between members of the Blockchain community (that it can be public or private) are transcribed in a block of the Blockchain itself and, if the community is public, they are visible to all or partially depending on the different privileges of the subjects involved. When a member arranges a new transaction, he "signs" it with his private cryptographic key. With the public key it occurs automatically the authenticity of the signature (which is generated again with each transaction).

Once a certain number of transactions have been reached, they are grouped and give life to a new block in the Blockchain. Each block basically contains the hash of the previous block, the time and date it was created, the data relating to new transactions and a characteristic number that uniquely connotes the block (its hash).

Hashing

THEhash is a string of bits obtained through an algorithm starting from the original file. It doesn't matter what the size of the source file is: the resulting hash is always a much smaller file with a predetermined number of bits. The same file always has only one hash, and from the hash it is absolutely impossible to trace the original file. Not only. The slightest modification of the 'source' file produces a hash completely different.

So each block of the Blockchain is uniquely marked by a hash (think of a fingerprint) and the hash of the following blocks depends on the hash of the previous ones. It follows that if I tamper with the data of a block even slightly, it will completely change its hash and consequently that of all the resulting blocks; this effectively makes it impossible to tamper with transactions without the other members of the Blockchain noticing.

Mining

But who has the right to write the new block in the Blockchain? To this end, a kind of competition takes place between some or all of the said Blockchain members miner.

I miner they must assign a number to the new block such that the resulting hash for the block itself has certain characteristics (for example the first 40 positions are zero). The problem cannot be solved except by trying all possible combinations until the string with the desired characteristics is found. The first miner which solves the problem, transmits the updated Blockchain with the new node to all the others, which will then become part of the shared electronic register.

In the very unlikely event that two different blocks are approved - one of which is 'hacked' - they will give rise to two different chains, one real and one fake.

The true chain is destined to grow because all miner they will continue to insert the new blocks on it, while only the hacker will continue on the counterfeit one, and since the hacker will not be able to keep up with all the other miners (for a pure statistical fact), it will be enough for the other miners take the longest chain for granted (the one that incorporates more "work", more Proof of work).

sharing

Blockchain was born as shared database underlying cryptocurrency applications, particularly Bitcoin, but can be used practically in all areas of settlement involving the exchange of value and the registration of the status of the assets of the members of the chain: notarial deeds, land registry, green certificates, information on social media and sharing economy, kilowatt hours, artistic copyrights, patents, medical records.

In all these areas, the adoption of Blockchain technology eliminates intermediation, shorten the times, saves money, increases safety and makes everything transparent to community members.

FIELDS OF APPLICATION OF THE BLOCKCHAIN

The possible fields of application are many, we limit ourselves here to highlighting three that we consider particularly interesting.

E-LEARNING TRAINING

Blockchain technology can be incorporated into systems LMS, and used to guarantee and increase control and safety, both in the course fruition phase and in the certification issue phase (especially in the case of compulsory courses or training credit dispensers).

With the creation of a Blockchain-based digital educational ledger, any information added to the chain must be approved by other participants, and the record consequently cannot be falsified.

The information entered is easily controllable, it becomes impossible for people to create false certifications to claim to have passed a certain course, the need for a "certifying" intermediary becomes redundant, and the certification process becomes more effective for all the protagonists of the training event: the manager of the Learning Management System who has direct access to the learner's register, the HR of the company who can verify with certainty the validity and the eventual expiry of the learner's courses (also by automatically enrolling employees in new qualifying courses), the course user who receives the verification of the qualifications obtained and can manage or share them with potential employers, training centers, universities.

SMART CONTRACT

These are contracts implemented in the Blockchain software, which are automatically executed when certain conditions are met (for example a payment or the delivery of a file and its acceptance).

A good proxy to understand these smart contracts is represented by the drink vending machines: you put the money in and type what you want, the machine does a series of checks (that the money is sufficient, that it is not fake, that the drink is is in stock ...) and then automatically dispenses and gives change.

If we carry this example on a large scale, for example in a supply contract, or in one for the sale of a house: notaries, banks, deferrals, land registry are eliminated simply by making the contracts automatically executable upon verification of the conditions provided.

PERSONAL DATA PROCESSING

Let's imagine that our personal data are written on the Blockchain and are accessible only by us, who decide which subjects to give from time to time access only to that part of the data that we want to make them visible.

Our data no longer resides in the centralized databases of companies and institutions such as banks, the Municipality, sharing platforms and so on, but are distributed on a decentralized database, of which we have full control.

We want to thank you Paolo Riccardo Felicioli for support on technical content

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