Exploring Blockchain Technology: A Financial Institution's Transformation - Free Essay Sample

INTRODUCTION

Various developments that have been made in information processing systems have increased the need for security, especially during the storage of data. Cloud computing continues to be recognized as a utility for cloud users. Depending on the premises where the users live in, they can access, share, or even transact their data regardless of the time and place. That means that the cloud users may lack the ability to have access to their data after the uploading to the respective cloud servers. Depending on the terms and conditions indicated by the cloud providers, their services are based on different forms, including as-is and as-available[5].

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

As the "information age" deepens, people can notice an increase in the velocity, volume, and variety of data availability. The originality of data can be from various sources, including sensors and social networks. Such availability of the data can raise various questions that should be studied. Such studies include the effectiveness of administering large amounts of data and identifying some of the most effective means of unlocking information. The information processing units, especially in the financial market, require the development of next-generation financial technology to assure security in the network technology and user communication.

The concept of Blockchain is considered the public ledger in such industries since it plays the role of providing secured online transactions. Most of the transactions conducted through the blockchain concept are conducted through the authentication process, meaning that the customers have to perform virtual transactions. Periodic updating of the Blockchain is required, especially in securing the electronic money transactions, which is expected to share some of the latest transaction detail blocks [1].

Blockchain is required to provide cloud users with trusted and secured data when outsourcing and acquiring some cloud services. The Blockchain is considered the most effective mechanism of providing security to cloud users rather than centralized database security. The Blockchain has the responsibility of monitoring all forms of records associated with the functions of the previous block. It is considered a mechanism of providing security at par and data storage, especially at the central database. Based on the data aspect management, the Blockchain helps prevent any damage to the stored data and any possible attack that may be directed towards the available data[3].

BACKGROUND

The authentication process is one of the most significant problems that cloud users face. Cloud computing usually delivers most of the incentive computing services through different techniques, including the pooling of various resources and virtualization. That makes security that can only be offered through blockchain technology critical, especially in the cloud computing paradigms. Therefore, the organization is expected to play the responsibility of offering the end-users with a variety of application services. Therefore, it means that the security context is important for all the users of such applications. Still, they have to log in before they can access any service offered in such applications[1].

A similar situation of authentication is not only evident when one is accessing an application but also when a person is accessing resources in different security domains. Blockchain technology is considered the most effective security measure, especially in securing the credentials that all cloud users apply while accessing a particular application. Majority of the financial organizations face similar problems during the cloud migration. Complexity in the management of access control increases as the application's services grow. Most of the applications that the financial organization uses are based on maintaining the institution's value; therefore, blockchain technology helps increase flexibility in the authentication process. Compromising the authentication process has become harder since the application of blockchain technology. In contrast, the auditing of such applications is now done separately.

Saving data that comprises all exchange information is another critical problem that most financial organizations experience. Blockchain technology plays a great role in ensuring such organizations refresh their records, especially when there is an extra trade. Blockchain technology ensures a smooth flow of information from peer to peer, which is based on the support offered by an outsider. The technology ensures protection of the safety costs through providing an effortless actualization of services and diminishing managerial outlays.

Blockchain technology has recently been linked with the cloud system to increase its effectiveness in offering security. It is considered as a form of distributed architecture that applies the cryptographically signed transactions. That makes the technology operate in a manner that is considered block-wise, meaning all the blocks are linked together with the cryptographic systems. Blockchain technology ensures that transactions are authenticated at all points of failure. The peer-to-peer (P2P) model plays a significant role in such a function. The model does not necessarily require the cloud users to pay the broker fees required for authorization of all transactions conducted. That is mainly because blockchain technology provides robust and scalable security to most end systems hence declining the growth of the technology. Therefore, hackers are faced with many challenges while trying to contradict most of the transactions conducted through the systems[4].

The application of hashes in blockchain technology plays a great role in adopting different use cases. Its main responsibility in blockchain technology is encrypting any data that may be present within the system. The changes that may be made on the data within the system may predict the output with some of the specified changes that have already been implemented by the hashes within the technology. The SHA-256 algorithm is the one that is most effective in the changes that are made in the data that is within the system[3].

The ledgers are also inclusive within the various transactions conducted through the blockchain technology, making all nodes have their copies of transactions. The same concept of using paper and a pen to compose a ledger is reflected in adopting blockchain technology. Therefore, it means that the technology is responsible for preventing any sudden loss of data and ensuring all transactions are effectively verified with the third party. Nevertheless, each centralized ledger has its demerits, including the single point of failure experienced by all transactions within the technology[1].

All the nodes within the blocks receive a transaction ID provided to them by the end-users. Considering the availability of such a transaction index, the other operations proceed until an end in the transaction is evident. The mid-operations cannot save the transactional process. The blockchain technology ensures that all the queued transactions are conducted accordingly. Therefore, the mining nodes have the responsibility of updating how the transaction is being conducted in every phase. Therefore, blockchain technology entails the full set of available transactions. The technology has the mandate of rejecting any invalid transaction hence meaning that any change that may take place in any transaction phase may affect the actual output in the block[2].

Blockchain technology has mining nodes whose responsibilities include updating the transaction process conducted in all phases. That means that blockchain technology is composed of different sets of transactions. Additionally, blockchain technology needs to share transactions as part of improving security during cloud computing. The technology helps prevent any mistake since it keeps close supervision to ensure that all the nodes match.

PROPOSED FRAMEWORK

Cloud computing should consist of large networks of virtualized services. Such services include both hardware and software resources. All forms of services within cloud computing should belong to the data centers referred to as data farms. There are only two methods that can be used to integrate blockchain technology within cloud computing systems. One such method is through the facilitation of the enterprise networks such as storage and accessing the transactional database. The other method entails securing the concepts associated with various parties such as the task, user, and data managed through cloud computing[2].

Various challenges that are involved within cloud-based blockchain transactions should be addressed effectively. Some of such challenges are considered to be naturally enormous, with elasticity and scalability being some of the most significant cloud computing functions, especially in some of the dynamic environments. One such challenge is based on security, where the data should be hidden and stored in the data centers. That means that it is necessary to have the tuning purposes when assigning the transactional activities. Therefore, the customers are provided with the opportunity to choose the locations where the respective cloud computing services will store their data.

Another significant challenge that should be addressed by using blockchain technology to secure cloud computing should be the resilience of the respective cloud systems and fault tolerance. The cloud computing system should have the capability of finding the most significant alternate node in case of failure of any other node within the network. That means blockchain technology should come up with a mechanism of replicating the nodes, especially in the data centers, and apply multiple software. Another challenge that should be addressed is improving security towards the blockchain [2].

CONCLUSION

Blockchain technology has been identified as a new form of technology that supports various information processing units, especially during financial transactions. Most of its users store their data within the P2P model, which acts as a form of effective computing resource utilization. Securing in financial transactions through blockchain technology is mainly assured by two more significant algorithms: proof-of-work and the proof-of-stake. That is why the paper's main focus is how blockchain technology is used in securing cloud computing. The main aim of using the integrated system is to enhance trust between different parties involved in the transactions, including the data server, data users, and data security.