Have you ever thought about what would happen to your digital assets in your absence? You have scores of memorable photographs on your social media accounts, crucial emails that you cannot afford to lose, vital office documents/contracts, and so on. Can you guarantee that your digital assets would be safe from attacks or tampering in your absence- say, when you are on a holiday or if your social media or email account gets hacked or if your office computer encounters a crash? You might not, unless you have stored them on a blockchain. Read more about digital assets at Multibank.io.
Put simply, as of 2022, blockchain is reportedly the ultimate platform to ensure optimum safety for the protection of your digital assets – as well as management.
Well, before getting into the discussion of why blockchain could be the most credible solution for digital assets protection and management, let’s have a look at the basic features of blockchain. The following brief will help to gather a basic understanding of the underlying technology of blockchain.
Blockchain is a shared public electronic ledger developed over a distributed network of nodes (computers). Key features of blockchain are-
Decentralization- Blockchain operates over a decentralized infrastructure that is not controlled by any centralized authority.
Immutability- No data entered on the blockchain can be manipulated.
Cryptographic protection- All information entered into the blocks of a blockchain are guarded by cryptographic protection that is almost impenetrable.
Transparency- As blockchain is based on a distributed ledger, the platform assures easy transparency across its entire database.
Why consider blockchain for credible digital assets protection and management?
Tamper-proof digital assets storage
When it comes to your digital assets, the last thing you want is any unwanted and unauthorized alteration or manipulation of the assets. But, there is no dearth of nefarious elements around and they are always looking for ways to tamper with your assets for their own sweet interest. Well, this is where blockchain storage of digital assets could come to your rescue.
Cryptographic protection
When you store digital assets into blockchain, all the information related to the assets would come under the shield of advanced encryption. Encrypted data is next to impossible to hack.
Data cannot be altered
The “immutability” quotient of blockchain assures no part of your stored digital assets could be manipulated, modified, or altered by anybody. Once you enter the digital assets into a blockchain platform, the entire gamut of information will stay intact.
Every block in a blockchain is protected by a complicated computer-generated code aka hash. These blocks also carry hash from previous blocks resting in the blockchain. These matching hashes guarantee that the block-chain is in the right order, intact, and also unaltered. If someone approaches to manipulate the data contained in any of the blocks, s/he has to generate fresh hash for the block. But, the hacker here doesn’t have the hash from the previous block and it would need him/her to do a massive amount of recalculation which can be extremely overwhelming even for the most determined hackers. If the hash codes of individual blocks don’t match with that of previous blocks, the entire chain will be disrupted. The hacker would then need to recalculate hash for each subsequent block to hide the tampering efforts and put the chain in perfect order.
But, the whole process is extremely complicated, daunting, laborious, and will demand mammoth computing power. It’s not humanly possible for even the most determined hackers to manipulate the blocks and eventually the digital assets stored in blockchain.
No unauthorized access to digital assets
Let’s say, your company has developed a patent pending technology and stored the related data in your computer. What if your rivals have got a whiff of the development and now want to steal the data? Do you think your office computer’s antivirus protection will be enough to prevent these nefarious elements from snooping into your precious digital asset? Well, this is again another key area where blockchain would be able to assure credible protection for your confidential digital assets.
Although blockchain ensures transparency throughout its distributed ledger yet the technology also carries the feature of private key. When you store your digital assets on blockchain, you can guard the most sensitive parts of those assets (or the entire gamut of assets) with an impenetrable private key. The private key would bar all attempts of unauthorized access to your digital assets stored on the blockchain.
Permission-based access
Now, what if some of the employees need access to some parts of your digital assets for business operation?
One of the best aspects of blockchain is that it helps you to set permissioned access facilities on the digital assets data stored on its network. This way, blockchain doesn’t force you to compromise on easy management of your digital assets for the optimum safety for your vulnerable data.
Automatic execution by smart contracts
Smart contracts are the jewels of a blockchain platform. We did not mention smart contracts in the “features” list above because smart contracts are not blockchain features- rather a sort of application developed on blockchain.
These are self-enforceable digital contracts that perform automatic execution once certain pre-set conditions have been made. This way you can store your confidential business contracts on smart contracts of a blockchain. You can set the condition that once certain factors have been met, the contract will be released to the other party- say, a client or a vendor. Given its storage on the blockchain, the contract cannot be manipulated or altered. Moreover, the clause of the digital asset will be immediately and automatically executed once both parties meet the conditions.
The whole process makes it a whole lot faster, convenient, and safer to manage digital assets.
Easy traceability
This is another reason why digital assets like NFTs are built on blockchain.
For example, artists creating digital arts on NFTs can embed their signature on these digital assets. Thanks to the traceability feature of the blockchain, the signature will help anybody to trace down the original creator of these digital assets in just a few minutes. This feature is especially helpful when artists have to prove their creative rights over their digital assets for royalties.
The traceability part also helps to ensure easy transparency about information stored in digital assets. It would be especially helpful to maintain a clear chain of communication between all the departments of your company who are operating with a particular part of (or whole of) your digital assets. Every department would have access to needed data stored into the digital assets that will eventually prevent risks of miscommunication – and also speed up the operational process.
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