Dear Editor,
My interest in Blockchain technology has grown since being the coordinator of the National Payment Strategy Project in Guyana. Recently, Vice President Dr. Bharrat Jagdeo, at his weekly press conference, indicated that Guyana would introduce Blockchain at Lands and Survey and the Guyana Geology and Mines Commission (GGMC). This move will prevent record tampering for personal gains and digitally simplify the process. In this commentary, I will try to simplify the concept of Blockchain for a layman’s understanding without too much of technical jargon based on my reading of the literature.
Simply defined, a Blockchain is a decentralized peer to peer system that does not require a third-party validation and based on trust, according to the Economist magazine. It does this by having a shared electronic ledger or records. Before a new transaction is recorded it must be agreed to by all users according to agreed rules and once inputted, it cannot be tampered with. Blockchain technology is digitally secured and cannot be tampered with by fraudsters and hackers. It reduces the chance of errors and fraud while reducing complexity and increasing efficiencies. Blockchain is based on trust. Trust in business is the expectation that the other party will behave according to the four principles of integrity: honesty, consideration, accountability, and transparency.
Blockchain is mathematics at its core and is specifically based on the application of cryptography. This permits a new unchanged value called a hash to be generated every time something of value, which complies with the rules, occur on a Blockchain. The hash function is a digital fingerprint of data with a digital signature for consent in each block and all its contents. The blocks contain the hash of all previous blocks in the chain. If one block is altered, all the blocks in the Blockchain ahead of it will be rendered invalid. A hacker has to tamper with millions of blocks on the chain to be successful and will be caught even with the use of high speed super computers. A new block is only added to the Blockchain when all of its users are satisfied, and moreover, there is a constant upgrading of the algorithm by specialists to ensure the technology stay ahead of hackers and fraudsters.
The Economist (2015/10/31) argued that Blockchain technology will ensure cheap, tamper- proof public data bases – land registries or registers of ownership of luxury goods or work of arts. Documents can be notarized by embedding information about them into public Blockchain – you will no longer need a notary to vouch for them. A foremost Peruvian Economist, Hernando de Soto, emphasized that “the central idea to Blockchain is that the right to goods can be transacted whether they be financial, hard assets or ideas. The goal is not to record a plot of land but rather to record the right involved so that the right holder cannot be violated”. The old system is open to errors through relying on humans for validation and legal checks can be open to fraud, depending on the individual as well as the transactions involved, and because it is done on paper there can be delays and fraud.
I have not discussed the role of Blockchain in finance where it has made its greatest impact and now science and protection of Intellectual Property rights. A few countries, corporations and banks have had success stories from adopting Blockchain technology. In Guyana, this can perform wonders given its antiquated record keeping and I have experienced persons with legal transport losing their title through fraudulent means. The idea of block augurs well for the future since it protects the assets of the poor and less influential without hefty fees by lawyers and accountants.
Sincerely,
Rajendra Rampersaud