BLOCKCHAIN TECHNOLOGY

BLOCKCHAIN TECHNOLOGY. By – Garvit Anand and Saksham Palmia.

WHAT IS A BLOCKCHAIN?. Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network..

WHAT IS BITCOIN?. Bitcoin ( ₿ ) is a decentralized digital currency that can be transferred on the peer-to-peer bitcoin network . Bitcoin transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain..

HISTORY OF BITCOIN. A short history of Bitcoin : 2008: The first description of Bitcoin was published in 2008 by an individual or a group under the pseudonym “Satoshi Nakamoto” in a now very famous white paper. 2009: The Bitcoin Network goes live and the first Bitcoins are mined. 2010: The first cryptocurrency stock exchange for trading Bitcoin is launched. 2011: One Bitcoin equals one USD..

HISTORY OF BITCOIN. 2013: One Bitcoin now equals 100 USD. 2014: Microsoft starts accepting Bitcoin as payments. 2017: One Bitcoin equals 10,000 USD..

HOW ARE TRANSACTIONS DONE IN A BLOCKCHAIN?.

USES OF BLOCKCHAIN. BitPesa It is a digital foreign exchange and payment platform for frontier markets . Storj It is a crypto currency and digital payment system and is also a blockchain-based digital storage and data retrieval method . Riot Blockchain Formerly a biotech company called Bioptix, the company rebranded and is now listed on the NASDAQ exchange under ticker symbol RIOT, making it the first purely Blockchain focused public US stock..

Golem Golem is a global, open source, decentralized supercomputer that anyone can access. It is made up of the combined power of user’s machines, from PCs to entire data centers . Open Bazaar It is one of the first marketplaces that accepts cryptocurrency for transactions. Think of it like a hybrid of eBay and Etsy that runs on cryptocurrency and charges no fees . Chronicled The coolest features allow for better supply chain control and management and anti-fraud opportunities to protect brand integrity around the world..

ADVANTAGES. Transparency Users or developers have the opportunity to modify it as they see fit. This makes blockchain a particularly secure technology . Reduced transaction costs Blockchain allows peer-to-peer and business-to- business transactions to be completed without the need for a third party. it means they can actually reduce costs to the user or businesses over time..

top. Faster transaction settlements Blockchain technology is working 24 hours a day, seven days a week, meaning blockchain-based transactions process considerably more quickly. Decentralization Blockchain actually allows individual transactions to have their own proof of validity and the authorization to enforce those constraints..

Efficiency Blockchain removes any third-party intervention between transactions and removes the mistake making the system efficient and faster. Settlement is made easier and smooth . Tighter Security Blockchain uses hashing techniques to store each transaction on a block that is connected to each other so it has tighter security. It uses SHA 256 hashing technique for storing transactions..

DISADVANTAGES. Scalability It is one of the biggest drawbacks of blockchain technology as it cannot be scaled due to the fixed size of the block for storing information. The block size is 1 MB due to which it can hold only a couple of transactions on a single block . Immaturity Blockchain is only a couple-year-old technology so people do not have much confidence in it, they are not ready to invest in it yet several applications of blockchain are doing great in different industries but still it needs to win the confidence of even more people to be recognized for its complete utilization..

Energy Consuming For verifying any transaction a lot of energy is used so it becomes a problem according to the survey it is considered that 0.3 percent of the world’s electricity had been used by 2018 in the verification of transactions done using blockchain technology . Time Consuming To add the next block in the chain miners need to compute nonce values many times so this is a time-consuming process and needs to be speed up to be used for industrial purposes..

Legal Formalities In some countries, the use of blockchain technology applications is banned like cryptocurrency due to some environmental issues they are not promoting to use blockchain technology in the commercial sector . Storage Blockchain databases are stored on all the nodes of the network creates an issue with the storage, increasing number of transactions will require more storage..

Applications of Blockchain. Asset Management Blockchain plays a big part in the financial world and it is no different in asset management. In general terms, asset management involves the handling and exchange of different assets that an individual may own such as fixed income, real estate, equity, mutual funds, commodities, and other alternative investments . Cross-Border Payments Blockchain has helped in simplifying these cross border payments by providing end-to-end remittance services without any intermediaries. There are many remittance companies that offer Blockchain services which can be used to make international remittances within 24 hours..

Cryptocurrency One of the many advantages of cryptocurrency using blockchain as it has no geographical limitations. So crypto coins can be used for transactions all over the world . Online Identity Verification It is not possible to complete any financial transactions online without online verification and identification. And this is true for all the possible service providers any user might have in the financial and banking industry. However, blockchain can centralize the online identity verification process so that users only need to verify their identity once using blockchain and then they can share this identity with whichever service provider they want..

Copyright and Royalties Copyright and royalties are a big issue in creative sectors like music, films, etc. These are artistic mediums and it doesn’t sound like they have any link with Blockchain. But this technology is quite important in ensuring security and transparency in the creative industries. There are many instances where music, films, art, etc. is plagiarized and due credit is not given to the original artists. This can be rectified using Blockchain which has a detailed ledger of artist rights. Blockchain is also transparent and can provide a secure record of artist royalties and deals with big production companies. The payment of royalties can also be managed using digital currencies like Bitcoin..

Conclusion. Blockchain is a relatively new technology that is still not widespread in all industries but it is slowly gaining more momentum. Once Blockchain becomes more widespread, it could become a powerful tool for the democratization of data that will encourage transparency and ethical business tactics..

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