Distributed Ledger Technology may be perhaps the greatest benefit so far to come out of the advances in blockchain technology. With it, participants in a distributed network can each maintain a copy of an unchangeable record of transactions and can execute transactions without having to answer to any single central authority.
This decentralized DLT approach allows you to extend your data to be used by others, but without exposing that data to the risk of being changed or manipulated in ways you don’t want.
Wherever you may be looking to use DLT – from IoT to asset management, supply chain improvements, financial transactions, process automation, or to leverage any critically important database – there are six key benefits that you should know. Let’s take a look at each of them:
How many times has your organization been frustrated because critical data can’t be easily seen, viewed, or used by important customers or partners? You’re not alone. This is a common frustration. DLT solves this problem by making critical data easily viewable and accessible.
With DLT, any party to the distributed ledger can inspect the data on it and check digital signatures. This doesn’t mean everything is visible, because you can still control visibility through permissioned ledgers. But it does allow you to maximize the transparency of your data while continuing to protect it. Without DLT, your data could be misused or altered.
It’s also helpful that data in the ledger can serve as a digital signature for other data, so the ledger offers a mechanism to prove the integrity of data that – even though it is not actually recorded on the ledger – is known to multiple parties.
Has your organization ever had an inaccurate Excel spreadsheet or Access database, due to improperly keyed input? If not, you’re lucky, because it happens to just about everybody.
With DLT, once data entries are correctly committed, they become essentially permanent history, with any attempts to change that history prevented by the sequence of cryptographic signatures that would reveal the effort. Errors or fraud are essentially eliminated. In the uncommon event that your database was incorrect from the beginning, DLT offers a straightforward solution for repair.
That is because with immutability, data that is established as ratified once will stay ratified and accurate as long as the database exists. That is essential, because unless it is dependably accurate and trustworthy, it isn’t really data.
Today, most organizations achieve resilience by synchronizing databases. No doubt for your company that synchronization process is time-consuming and confusing. DLT allows for a simplified form of data synchronization by the very nature of the way the algorithms are created.
What DLT does is replicate the ledger data across many, or all, of the nodes that make up the network. In the event one of the component systems of the network fails, it isn’t a problem since there will be many other nodes continuing to run and to support the ledger operations.
It’s worth noting that additional new and interesting forms of consensus are emerging that allow for even more streamlined data synchronization and validation. One common criticism of DLT is that it involves a lot of overhead due to all of its processing, but we are seeing a change in algorithms that should solve that problem.
No controlling party
In your business you deal with many types of suppliers, partners, and customers. Wouldn’t it be nice to be able to harmonize these entities into a mechanism that allows simultaneous technical or business changes to be broadcast to all relevant parties?
That’s possible through the distributed aspects of DLT and the absence of any one ledger-controlling party.
With DLT, the operation of the ledger doesn’t depend on any one organization’s systems, ownership, or business continuity. So no one entity can negatively influence ledger operations in ways such as introducing new charging mechanisms or making technical changes that alter the design of the ledger.
Wouldn’t it be nice for your organization to be able to grow smoothly, quickly, and efficiently as you enter new business models? Scalability is a pre-eminent capability within DLT, allowing it to scale rapidly, even to a vast scope.
This ability to scale horizontally enables DLT to meet a growth in demand by applications and to support higher levels of resilience. Importantly, this scaling can be done globally to support international growth as the applications then access more local nodes. That’s a benefit in itself, since it yields lower latency for API calls.
Don’t you want all your applications to be secure? With all your servers and all the machines in your computer facility able to be trusted and your data being perfect?
Distributed ledgers take advantage of strong cryptographic techniques to secure the data recorded on them. The fact that they are distributed and that data is synchronized across the network offers powerful security against attacks or attempts to change the ledger content.
DLT offers the capstone of security by uniting Layer 7 security with trusted enablement of your machinery, your process servers and your sensors, creating an entity that sets up the data as true and accurate and non-violable. This becomes the fundamental basis upon which you can do business.
Everyone wants to be able to trust their networks, whether those networks are internal or carrier-provided or a combination. Ledger technologies make it possible for enterprises to be able to trust the data from sources in both external and internal networks.