Blockchain is best known as the technology underlying cryptocurrencies like Bitcoin, but its potential applications are far broader. It may be about to shake up the way organizations manage and share information, and that’s why records management professionals should pay attention to it.
Blockchain is a technology that enables parties who don’t know each other to conduct secure, trusted and anonymous transactions without the need for intermediaries. It can also verify the authenticity of digital content such as documents, images and recordings.
It does this by embedding unique, encrypted codes into digital assets and distributing updated copies of those assets to everyone participating in the blockchain whenever a change is made. As long as the digital signatures match exactly, participants know that the information is valid. A distributed ledger tracks the status of all the assets in the chain. If one asset is found to be inconsistent with the others, the transaction is rejected.
The Implications for Records Management
Blockchain can potentially eliminate the need for third-party verification of authenticity. Transactions can be completed more swiftly as a result, and records managers can be assured of the integrity of the information they protect.
Blockchain can also greatly simplify the task of safeguarding sensitive information. Because of its distributed nature, blockchain can store data across a network of peer devices. The individual bits of information are effectively useless to an attacker, and reassembling the information without access to the cryptographic keys is impossible.
For compliance and legal purposes, blockchain is an inexpensive and reliable way to ensure the integrity of information. The technology eliminates fraud by making it impossible to duplicate digital content without disrupting the blockchain. Records managers can quickly retrieve information required by regulators without time-consuming verification or legal review.
Blockchain may disrupt some industries by dramatically streamlining processes and slashing costs. Organizations that understand its potential will have an advantage.