Blockchains and databases have a lot in common; for starters, they’re both used to store data, which is why you often see the two terms crop up wherever there’s a discussion of blockchain technology. One could even say that blockchains are a type of database without being completely wrong.
However, blockchains and databases are structurally and functionally different from each other. So what is a database? What is a blockchain? And what is the difference?
What is a database?
A database is an organized collection of information that is stored and accessed electronically. Databases are managed through a database management system (DBMS), which is the software through which end users interact with the database. The database, DBMS, and all other associated applications are referred to as “database systems.”
Databases are categorized by their design, that is, how they sort, organize, and store data. Database design takes into account several techniques and practical considerations, including data modeling, efficient data storage and representation, security, privacy, and distributed computing issues, such as fault tolerance.
There are several types of data models, including hierarchical, network, object, and document models, the most popular being the relational model, which organizes data into tables made up of rows and tables called “relationships”. .
However, driven by the emergence of the Internet, the 2000s saw a peak in demand for large distributed databases with high partition tolerance, which was a problem for relational databases. In response, other data models that can better handle scalability have become popular, such as NoSQL and NewSQL.
Although there are several types of databases, there is one thing they all have in common. An administrator executes them centrally through the DBMS, whether distributed or not, and the administrator has the ability not only to read but also to write.
Databases have many practical use cases, including finance, telecommunications, and transportation, and are used to hold library systems, flight reservations, content management systems, and more. .
What is a Blockchain?
A blockchain is, quite simply, a distributed ledger, which some might say is a type of distributed database. And they wouldn’t be entirely wrong. Both being the product of distributed computing, blockchains and distributed databases share many of their underlying technologies.
Blockchains are distributed because, like distributed databases, they are not located in one place but on different nodes which are linked by a peer-to-peer network, virtually transforming it into a single ecosystem. But that’s as far as their similarities go.
Unlike distributed databases, blockchains are not centrally managed. Instead, blockchains operate as decentralized peer-to-peer networks, with nodes checking and accepting the current state of the blockchain through a consensus mechanism.
Blockchains store data in the form of “blocks”, with each block containing a cryptographic hash of the previous block, timestamp, and transaction data. Finally, once consensus is reached, new blocks are added to the blockchain by linking them securely using cryptography.
Although records on a blockchain can, in theory, be modified, blockchains are considered by some to be secure by design and are a good example of a distributed computing system with high partition tolerance.
Blockchain technology is still under development and many new use cases are being discovered every day. Its use cases are as a digital ledger for cryptocurrencies, smart contract settlement, virtual item tokenization, and supply chain management.
What is the difference between a database and a blockchain?
Although databases and blockchains both serve as stores of data, they are structurally and functionally different from each other, from how they store and organize data to how it is managed.
Blockchains store data in blocks unlike other data structures traditionally used by databases, and because they are decentralized, they eliminate the need for an administrator. For all these reasons, blockchains are not best described as a database but rather as a store of data.