My first tryst with Blockchain was back in late 2010. It was one of those geeky things the technology underworld was going crazy about. Bitcoin (the first cryptocurrency based on the Blockchain methodology) was touted as the next big way of making payments. I downloaded a miner and started cranking up my Linux laptop and waited for the riches poured in. (Long story, still kinda hurts).
Fast forward to the last few months, things have exploded beyond recognition. Bitcoin, Ethereum, and other crypto-tokens started being positioned as digital assets and were being positioned as a valid investment. Bitcoin is Digital Gold they say.
While many will debate on whether these are sound investment decisions, I draw attention to a fundamental flaw in the way people understand the technology behind this.
It’s important to understand the fundamentals in Blockchain to figure out if it’s the right technology to use to solve a problem. Let me take a stab at explaining this in a mildly technical manner.
There obviously more detail to consider but I’ve tried to simplify this as much as I could with my limited writing skills.
For the last few months, I’ve had many people come up and ask if we at MphRx been working on doing something in Blockchain. The supporting arguments are some bland variation of the following – “Blockchain is the future of Healthcare, Finance and is the best thing since sliced bread. It’s going to break all walls and make the world a better place”.
Does that mean that you can use Blockchain to securely share data across multiple organizations – solving thousands of problems in connectivity and data standards? Why don’t we just dump all our existing databases and use blockchain instead?
Yes, you heard that right. Blockchain can solve everything. Maybe even pick up your laundry while it’s solving world hunger, poverty, and healthcare.
In all seriousness, I encourage people to go back and read the original paper on Bitcoin that was published by an individual/group called Satoshi Nakamoto. It’s important to understand the key characteristics of the concept to effectively see where it can really add value.
This white paper described the original concept of how Bitcoin will be a peer-to-peer cash system and outlined the initial concept of Blockchain – an immutable, decentralized public ledger that could be used to securely share transactions without a central authority.
Blockchain is essentially a Linked List of objects that are stored by multiple participating parties. It can be shared across multiple organizations that add or use the information stored in those objects. There is a mechanism to get agreement on ‘what’ is the authenticity and right order of those objects.
There are two very key words here –immutable and decentralized.
Immutable means that once you have added something to a Blockchain, it cannot be edited. Simply put, Databases have traditionally worked under the CRUD principle (you can Create, Read, Update and Delete objects that are stored in the database).
Blockchain is based on the CRAB principle (you can Create, Retrieve, Append and Burn objects that are part of the chain). Basically once something is part of the chain, it’s not changing. It just, cannot, even when hell freezes over, EVER be modified.
De-centralized means that you can have several parties maintaining their own version of the blockchain, almost like a shared copy of a database. As other parties add objects to the blockchain, there is a mechanism by which they all agree on whether the new object is accepted and which order is it stored in.
Now, of course, this doesn’t solve the bigger problem of getting multiple organizations to play ball together – but let’s just ignore that for now.
So next time you think of how to use blockchain to solve a problem – think of this – does your solution need to store data or a piece of instruction that can never be changed and needs to be shared across multiple parties? If the answer to either of the two questions is No, you’d be better off using other shiny tools in your bag. And maybe look for the next bandwagon to jump aboard 🙂
Blockchain in Healthcare
I do see a lot of interesting applications for the concept of Blockchain in Healthcare – the most straightforward ones are around logistics and supply chain management. However, we do see more disruptive applications when it comes to driving more consumer-centric decision making.
And no, I’m not talking about patient data being stored on blockchain – it will take another blog post to describe why that doesn’t make sense. 🙂
Stay tuned for more!
Do you see any great opportunities for Blockchain in Healthcare? We definitely do – hit us up and we’d love to chat!
This blog was originally posted by Varun Anand on LinkedIn.