The Role of Blockchain Technology in Enhancing Data Integrity and Transparency Across Industries

Abstract

This technology applies cryptographic and consensus mechanisms that secure communications between participating peers. Each transaction on the blockchain is assigned a timestamp, thus establishing the transaction's historical order and preventing it from being altered. Newer transactions are added to the blockchain only after several participating nodes have approved them. Transactions approved on the same block form a distributed consensus around this block. If such a transaction is modified, the transaction's timestamp would be different from that recorded on the block containing it, and the distributed consensus would no longer hold. The blockchain would increase its size with the addition of subsequent blocks appended to it, making it computationally expensive to modify older transactions. These concerns are further fueled by the potential risk of data leaks or hacks that could occur directly or indirectly through third-party system providers. Many organizations do not fully comprehend how third parties could potentially gain access to sensitive information despite using various cybersecurity methods such as data encryption. Some online platforms contain shared databases that may store data collected by large networks of businesses, which allows them to gain a more thorough profile of an individual. This profiling is alarming consumers and resulting in distrust in how their data is used. There is a growing movement to decide whether personal data should be regarded as personal property instead of a product owned by online platforms. Consumer unrest has resulted in actions such as the General Data Protection Regulation (GDPR), which attempts to diminish online activity surveillance. Blockchain data is typically stored using linked data structures implemented in computer program language using Applications Programming Interfaces (APIs). A frequently used data structure is a Merkle tree, where a binary tree is used to store the information, creating a binary search tree that allows verifying the information with only a small subset of the data.