Blockchain vs. a database: What's the difference?

Blockchain has been accused by detractors as nothing more than a more complicated and expensive database. While both technologies offer data storage and management, blockchain has one unique feature a database will never replicate.

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Blockchain distributed ledger technology (DLT) has been touted as the answer for just about every transactional issue facing the world today – from payment processing and supply chain tracking to digital identities and copyright protection.

Databases, however, have been serving those same use cases for decades. They record how much money is in a bank account, when cargo reaches a destination and they store the identities of business users – enabling access to business applications and sensitive data.

Because of those similarities, there are cynics (some may even call them pragmatists) who believe once you strip away the hype associated with blockchain and its cryptocurrency origins, what you have left is nothing more than a fancy, but slow and expensive, database.

The argument goes that many of the purported attributes of blockchain can be accomplished with conventional, tried-and-true technology. For instance, there are already hashing algorithms, digital signatures and public key infrastructure (PKI) available for use. If you need a traceable, verified audit trail, you can save your transactions to a database and then digitally sign the data, hash it and store that hash.

The difference: blockchain has all of those features in one place and it plays well with others.

"There is value in blockchain in of itself as a distributed, independently verifiable single version of the truth shared amongst multiple entities – where no one entity is in control and all entities have equal access and equal control," said Avivah Litan, a Gartner vice president of research.

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