The blockchain ledger works by using cryptographic encryption to secure all data stored in the system. This enables the system to record transactions in an immutable manner. The data is stored in blocks, each containing data and a hash of the previous block. The hash is the unique identifier for the transaction, and it links each block in virtual mode. This prevents any tampering of the data.
Every transaction is recorded in the blockchain in order of when it occurred. There are many types of transactions, including those between different sets of participants. These must be written to the ledger in order, and a method to reject bad transactions must be established. As blocks are written, they are updated across the entire network, and each block represents a new group of transactions.
A blockchain ledger can help insurance companies verify the legitimacy of claims and transactions. This can also be useful in the real estate industry. With property titles recorded on the blockchain, sales can take place faster and without as many issues. In general, blockchain technology can be used by any business that seeks to ensure the integrity of data and to eliminate human error.
Blockchain ledgers cannot be pruned. However, in some industries, pruning may be necessary to comply with proscribed data retention requirements. The financial industry, for example, may have strict regulations regarding the retention of data. However, even if ledger data is pruned, it will still need to be archived.
