BLOCKCHAIN TECHNOLOGY

BLOCKCHAIN TECHNOLOGY

Historically, the first public blockchain was Bitcoin, which was launched in 2009. Any computer, regardless of where it is located, can freely access this blockchain and be involved in the process of approving new blocks. New blockchain concepts have emerged since the Bitcoin launch. These new types of distributed ledger offer the advantages of blockchain technology but restrict access to the network and the rights of the different users.

WHAT IS BLOCKCHAIN TECHNOLOGY?

Blockchain is a technology that allows data to be stored and exchanged on a peer-to-peer1 (P2P) basis. Structurally, blockchain data can be consulted, shared and secured thanks to consensus-based algorithms2. It is used in a decentralised manner and removes the need for intermediaries, or "trusted third parties".

BLOCKCHAIN HAVE TWO CONCEPTS

1. Asymmetrical cryptography,

which allows the use of a paired public and private key system. Asymmetrical cryptography enables users who do not know each other to exchange encrypted information. The system is based on a public key that can be made available to all, and allows encrypted data to be sent to a third party. The third party accesses the encrypted data via a paired private key. The public key is similar to a bank account number, which can be provided to anyone. The private key, which remains secret, acts as the password to the same bank account.

2. Distributed IT architecture.

A distributed system is a series of independent computers (nodes) that connect to a network and can communicate with each other. It is similar to the Internet, which also has

no central node. Downtime for one server does not affect the other users.

The blockchain network is a P2P (peer-to-peer) distributed system. Information is shared among the different users.

The blockchain is open-ended and operates in a decentralised, ongoing manner thanks to the activity of its users who can store information, and to consensus algorithms (notably

"proof-of-work" and "proof-of-stake"3) which certify the information per block (unit). Users running these algorithms are known as miners. When a block has been validated, it is added to the blockchain and shared with the network. Blocks are connected to each other in such a way that if users wish to change one block, the entire blockchain must also be changed.

On the Bitcoin blockchain, network security is guaranteed by the availability of massive computer power.

These two pillars asymmetrical cryptography and distributed IT architecture make it possible to create a secure environment that establishes a new basis for trust and allows for new ways of exchanging data, new types of transactions and new forms of contracts.

ADVANTAGE OF BLOCKCHAIN TECHNOLOGY

          1)     Transparency

The Blockchain Offer an audit trail that can be consulted at any time by all blockchain members.

          2)     Automation

           The rules set upstream by blockchain members via smart contracts allow for automatic settlement.

          3)     Autonomy

     The blockchain works according to the rules set by its members. There is no need for a central decision-making body.

           4)     Security

      Operating data input on the blockchain is deemed secure owing to the stacking of the blocks.

          5)     Client accountability

      Each blockchain participant has rights and obligations with regard to the blockchain community.

THERE ARE CURRENTLY THREE CATEGORIES OF BLOCKCHAIN.

       1)    PUBLIC BLOCKCHAINS

        All participants are able to access the database, store a copy, and modify it by making available their computing power. Bitcoin, for example, is a public blockchain.

       2)    CONSORTIUM BLOCKCHAINS

        These are open to the public but not all data is available to all participants. User rights differ and blocks are validated based on predefined rules. Consortium blockchains are therefore "partly decentralised". R3 consortium, which brings together 70 of the world's largest financial institutions to pilot the technology using a semi private blockchain, is a good example of this category.

        3)    PRIVATE BLOCKCHAINS

         These are where a central authority manages the rights to access or modify the database. The system can be easily incorporated within information systems and offers the added benefit of an encrypted audit trail. In private blockchains, the network has no need to encourage miners to use their computing power to run the validation algorithms.

Now Some Q & A

1)     What is Blockchaining?

-      A blockchain is a decentralized, distributed and public digital ledger that is used to     record transactions across many computers so that any involved record cannot be altered retroactively, without the alteration of all subsequent blocks.

2)     How do you implement Blockchain?

-      6 strategies to successfully implement blockchain

1)     Understand what blockchain is. A well-designed blockchain stores records in blocks that are linked to one another using a cryptographic technique that creates a digital, distributed ledger.

2)     Develop a business case

3)     Choose your blockchain carefully

4)     Build an ecosystem

5)     Design deliberately

6)     Navigate uncertainty.

3)     Why is Blockchain so important?

-      Blockchain is essential because it allows us to own digital goods, assets, and data.

4)     Can Blockchain be hacked?

-      Blockchain Cannot Be Hacked. While the details will vary between Blockchain protocols, the core of the technology is that it is a decentralized digital ledger of transactions. These transactions are verified in whatever way is deemed appropriate for the particular Blockchain application.

5)     What is Blockchain in simple words?

-      Blockchain is the technology the underpins digital currency (Bitcoin, Lite coin, Ethereum, and the like). The tech allows digital information to be distributed, but not copied. You may hear it described as a “digital ledger” stored in a distributed network.

6)     How safe is Blockchain?

-      Yes, blockchain is innately secure. Private keys are even more secure as they are considerably longer. It is in this way that blockchain offers a greater level of security to the individual user as it removes the need for weak and easily compromised passwords and online identities.

7)     How can companies use the Blockchain?

            -      4 Ways Any Business Can Use Blockchain

1) Better supply chain management. When a small-business owner places     an order with a supplier, it's clear who's on the other end of the                        transaction.

2)     More transparent contracts.

3)     Faster payments.

4)     Quicker background checks.

8)     What is so special about Blockchain?

-      Transparency and Privacy. Since blockchain decentralizes the system and enables everybody to arrive on the same network, the ability for people to view transactions becomes easier. Blockchain is a technology that increases transparency of transactions, as everybody on the network has a copy of the ledger

9)     How is data stored in a Blockchain?

-      The blockchain ledger serves as a decentralized database that maintains details about each transaction. The transactions are added to the ledger in chronological order and stored as a series of blocks. Each block references the preceding block to form an interconnected chain.

10)  What are the three key advantages of Blockchain?

-      The basic advantages of Blockchain technology are decentralization, immutability, security, and transparency. The blockchain technology allows for verification without having to be dependent on third-parties. The data structure in a blockchain is append-only.