What is blockchain? As academic leaders, you want to stay on top of what's coming next. And the blockchain could transform how colleges and universities operate in 5 critical ways.
by Alicia Miranda, Research Analyst, Academic Impressions
What is the Blockchain?
The blockchain has been described as the new internet, the next generation of data and information. As a digital ledger that allows data to be dispersed across different users and user systems via cryptography, the blockchain allows for "trustless commerce in a trusted way," according to one leading blockchain expert. That means you do not have to know the person on the other end of a transaction in order to know the transaction is secure and permanent. The technology takes care of that for you.
Most people who have heard about the blockchain know of it because they’ve heard of cryptocurrency, such as Bitcoin or Ether. Blockchain is the technology that enables cryptocurrencies, but it has potential uses far beyond just Bitcoin.
Leading expert Michael L. Mathews, vice president of innovation and technology at Oral Roberts University, suggests that the basic concept of blockchain technology has already been proven by the US Library of Congress' use of MARC codes. These codes ensure that each item exists as only one entity and that there is only one copy that can be used at a time.
Here is how the technology works. A smart contract that involves complex algorithms is created and agreed upon by all users in a network. This contract is also known as a node, and it is used to place orders or data transitions. Users in a node are charged what is called a gas fee. All paying computers within a node are set up to handle blockchain transactions. For instance, when an institution assigns a student a blockchain diploma, the institution pays a fee and write a transaction that is recorded on the digital ledger. All computers in the node must record and verify the transaction, which adds a “block” to the “chain” of previous transactions. In this way, transactions are fully transparent, permanent, and distributed.
All computers in the network agree that a transaction is good via what is known as consensus algorithms. A bad transaction would easily be traced to the computer that made it. For this reason, it is nearly impossible to hack the blockchain, because hacking would require changing the transaction in the digital ledger for each computer within the node. That could mean thousands, even millions of computers.
5 Ways the Blockchain Can Transform Higher Education