Can blockchain be adopted to secure digitized documents?

How to use blockchain to make your document digitization safer and easier. 

Modern problems require modern solutions. Document digitization is a problem as modern as any, and it needs a clever solution that can protect sensitive information without getting in the way. Blockchain technology—the power behind cryptocurrencies like Bitcoin and Ethereum—offers an elegant document digitization solution with several advantages over current methods.

Below, you'll find information on how companies can use blockchain to make their document digitization safer, more efficient, and easier to use.

What is blockchain technology?

Blockchain is a distributed global system for recording and verifying transactions, famously introduced in 2008 as the backbone of a new digital currency called Bitcoin. Many people understandably conflate blockchain technology with Bitcoin and other cryptocurrencies, but it has broader utility. The value of blockchain comes from its fundamentally secure and permanent design, making it useful anywhere one requires privacy and reliability.

A blockchain has three main parts: blocks, chains, and a network. Blocks are groups of transactions or communications between parties on the network. For Bitcoin, these transactions are financial transfers where one party sends some Bitcoin to another.

Groups of blocks make up a chain of ordered transactions that anyone on the blockchain network can uniquely identify and verify. Blocks and chains and their relationship are the essential components that make blockchain a powerful solution for sending sensitive data over the internet.

How do you secure information in a blockchain?

Blockchain uses cryptographic hash functions to transfer information securely over a public network. Cryptographic hash functions use private keys to encode data, ensuring that anyone who doesn't know the private key cannot change it. The receiving party uses a public key to decode the message without knowing the private key. Think of a private key as a digital signature and the public key as recognizing that signature.

The public-private key design is not unique to blockchain technology. It is popular in many areas of internet security, from banking to accounts on sites like Google and YouTube. What sets blockchain apart from other security protocols is the clever way it makes chains forgery-proof.

Verifying a chain requires tremendous computing power, making it infeasible for bad actors to fake having the correct secret code. What's more, transactions get harder to fake as a chain grows, so changing one transaction at the end of a chain requires faking the entire chain. It would take the world's most powerful computers working continuously for longer than the universe's age to break blockchain—it's more or less an impossibility.

Can professionals adopt blockchain to secure document digitization? How can it help?

One of the most practical applications of blockchain is storing and sharing sensitive digital documents. The need to protect private information and prevent forgery is an essential piece of modern society that blockchain tech can make more reliable and efficient. Professionals can instantly send medical records, business contracts, and financial documents anywhere in the world without fear with a blockchain-based document digitization system.

Protects sensitive information

Saying that blockchain is secure is like saying the sun is hot. As mentioned, the mathematical principle that makes blockchain work is unbreakable by nature, making it impossible to alter or fake information once someone has entered it onto the blockchain.

Criminals can hack secure servers, and even verified users can accidentally send data transmissions to the wrong address. But documents on a blockchain are guaranteed to remain unchanged for as long as computers exist.

It makes documents easily accessible to verified parties

Serving sensitive documents to clients or customers can be a nightmare for a network security manager. When more people have access to a network, the chances of someone finding a crack in the armor and a way to steal or disrupt data increase.

Blockchain allows you to store information on an unhackable network, giving access to anyone who needs it while simultaneously providing guaranteed privacy. This simple process check makes it easy to share documents with those who need to see them, increasing efficiency by reducing clumsy verification steps and lowering your security budget.

Creates unalterable documents and information

Intentional foul play isn't the only problem that plagues document digitization. Humans are error-prone, and simple mistakes can be catastrophic if they happen to the wrong document at the wrong time. Having reliable records of document data is just as crucial as sending those documents securely, and it's another free benefit of blockchain technology.

Once you enter information on a blockchain, it is unalterable. It would be best to create a new blockchain entry—one entirely uncoupled from the original—to make changes. This change makes it impossible for someone to accidentally change information when viewing a document. Instead, the blockchain automatically creates an archive, allowing you to view the document's entire editing history.

Prevents duplications

Blockchain also prevents duplication, as the information any secured document contains has a unique representation in the chain. If the same party attempts to upload the same document, the blockchain can automatically flag it as redundant, saving space and possible confusion in the future.

Are there downsides to using blockchain for document digitization?

The case for using blockchain for document digitization is compelling, especially if you have an expert implementing the technology for you and your company. Still, there are potential downsides that business professionals should know before adopting such a system.

The technology is relatively new

Blockchain technology has been around for a decade. Ten years is a long time but implementing new tech in sensitive areas comes with many hurdles.

First, hiring and training blockchain engineers is more difficult than hiring a network security expert. It's challenging to assess a blockchain expert's qualifications when the entire pool of candidates is limited to 15 years of experience. Unless a company already has experienced blockchain developers on staff, it's time-consuming to get started.

Second, developing blockchain technology is time-intensive and expensive, offsetting some benefits of reduced overhead from maintaining a secure document server. Eventually, a blockchain solution for document digitization will save a business money, but the upfront costs can be high.

Finally, off-the-shelf blockchain tech is rarely a good idea for a security-focused use like document digitization. Malicious code or poor upstream design can derail future use of a pre-made system, and relying on a third party for a mission-critical component may be out of the question. It's a much better and safer idea to implement existing blockchain tech with the assistance of an expert.

There is still potential for security breaches

If a blockchain is implemented correctly, it is impossible to break—but that's a big “if." Code-based backdoors and attack vectors are rare but possible. The more significant threat comes from managing private keys.

There are countless stories from the cryptocurrency space of people losing large sums of money by allowing the theft of their private keys. Such security breaches are easy to avoid in theory but occur more frequently than some companies may be comfortable accepting. The good news is that a blockchain solution isn't any riskier in this regard than a traditional document digitization method.

Those who use blockchain technology for document digitization need to know the pitfalls and receive comprehensive training protecting their keys. This training is especially vital if the public is involved—for example, patients have access to medical records through a blockchain-based system.

The bottom line is blockchain is an excellent option for many document digitization needs, but it is only unhackable if an expert with extensive experience implements it. Whether blockchain tech is the answer for you depends on your specific use case.

Wrapping up: Blockchain technology could make document digitization far more secure

As the world becomes more digital, the need for modern, secure document digitization increases. Blockchain technology is a promising solution with many advantages over traditional approaches. When implemented correctly, it is unbreakable by design. Blockchain also provides a built-in, 100% reliable archive for sensitive documents with no additional effort required. Once someone stores a document on the blockchain, it's there for good.

Rolling out a blockchain solution can be difficult, especially in a company without blockchain experience. Finding talented, trustworthy developers can be a challenge, and purchasing a ready-made blockchain solution is usually not a good idea. Still, spending the time and effort to learn more about blockchain technology will be worth it eventually, as a blockchain-based document digitization solution is more secure, future-proof, and efficient than any traditional system.