PowerPoint Presentation

[Audio] Lesson 3: Blockchain Technology Essentials. Part Two..

[Audio] In this lesson, we're going deeper into the multifaceted world of blockchain. We'll explore the different types of blockchains and their unique characteristics. You'll gain insights into the advantages and disadvantages of each type, supplemented by real-world use cases. Objectives: Equip you with a thorough understanding of the various types of blockchains. Showcase real-world use cases to see the practical implementation of each blockchain type..

[Audio] Key concepts: Real-World Use Cases: We'll look at how public blockchains like Bitcoin differ from private blockchains that streamline supply chain management. Advantages and Disadvantages: We'll consider the strengths and weaknesses of each type. Public blockchains, for example, offer transparency but can have slower transaction times, whereas private blockchains might be faster but are more centralized..

[Audio] By the end of this lesson, you'll be able to: Distinguish between various blockchain types. Assess the advantages and disadvantages of each type. Apply your theoretical knowledge to understand how these technologies are being used in real-world scenarios..

[Audio] The growth of Bitcoin sparked interest in the underlying technology, leading to the emergence of Ethereum and the expansion of blockchain capabilities with smart contracts. As blockchain's potential became clear, it evolved into various types, from private to consortium blockchains, each addressing specific industry needs and limitations of public blockchains..

[Audio] Types of Blockchains. We have: Public Blockchains: Permissionless, like Bitcoin and Ethereum, open to all. Private Blockchains: Permissioned and controlled by a single organization, like Hyperledger Fabric. Consortium Blockchains: Controlled jointly by multiple organizations, such as Quorum or R3 Corda. Hybrid Blockchains and Sidechains: Mix features from public and private blockchains, allowing for customizable transparency levels and facilitating asset use across multiple blockchains..

[Audio] Public Blockchains. Permissioned & Permissionless..

[Audio] Public Blockchains. Definition and Characteristics: Decentralized and transparent, where anyone can join and transact. Can be permissionless or permissioned for specific activities..

[Audio] Permissionless (Public) Blockchains. Open to all and fully decentralized. Anyone can join, verify blocks, and create smart contracts. Examples: Bitcoin and Ethereum..

[Audio] Key Features of Permissionless Blockchains. Transparency: Full transaction history is visible to anyone in the network. Decentralization: No central authority; the network operates on a consensus mechanism. Inclusivity & Security: Open to all, and secured through distributed consensus. Smart Contracts: Self-executing contracts that run when conditions are met, ideal for decentralized networks. Empowerment: Each participant has a role in the network's governance..

[Audio] Advantages & Disadvantages of Permissionless Blockchains. Advantages include being censorship-resistant, incentivized participation, and high transparency. However, they may have slower transaction times, higher energy consumption, and offer less privacy..

[Audio] Examples of Permissionless Blockchains. Bitcoin: The pioneer in decentralized digital currency. Ethereum: Offers beyond currency with decentralized apps and smart contracts. Litecoin: A faster, more efficient alternative for transactions..

[Audio] Real-World Use Cases for Permissionless Blockchains. Cryptocurrency Transactions: Peer-to-peer transfers without intermediaries. Decentralized Applications (DApps): Ranging from games to finance. Smart Contracts: Automating agreement execution. Decentralized Identity Systems: Providing users with a single, verifiable identity..

[Audio] Permissioned (Private) Blockchains. Controlled by a single organization. Participants need an invitation. Centralized decision-making. Examples: Hyperledger Fabric.

[Audio] Key Features of Permissioned Blockchains. Permissioned blockchains offer a more controlled environment with selective transparency. They're not open like public blockchains; participation requires specific permissions. They offer regulated decentralization, keeping the checks and balances in place. This setup allows for higher efficiency and flexibility and can be customized for particular industry needs, providing enhanced security by knowing exactly who the participants are..

[Audio] The advantages of permissioned blockchains include selective transparency and regulated decentralization, which can lead to more efficient transactions. They're adaptable to specific industry needs and enhance security through vetted participation. However, they are not fully decentralized, and their transparency may not match that of public blockchains. There's also a dependency on governing entities for permissions..

[Audio] Two examples of permissioned blockchains are: Ripple (XRP): It's known for connecting banks, payment providers, and digital asset exchanges for faster, low-cost global transactions. While its ledger is public, the validators are a controlled set. Stellar: It's similar to Ripple, aiming to connect financial institutions for cross-border payments but with a more open approach to decentralization..

[Audio] Permissioned blockchains have several practical applications: They're great for cross-border payments, facilitating quicker and less expensive transactions between banks. In supply chain and logistics, they help track products from origin to delivery, ensuring authenticity and transparency. For voting systems, they offer a transparent and tamper-proof mechanism. They're also used in real estate to speed up the transfer process and reduce the need for intermediaries..

[Audio] Consortium Blockchains. Permissioned blockchains. Joint control by multiple organizations. Examples: Quorum and R3 Corda..

[Audio] Consortium Blockchains are exclusively designed and maintained, granting access solely to designated members within a particular organization or consortium, ensuring both security and data integrity..

[Audio] They are known for their high efficiency and controlled access, which is crucial for data privacy. They can be customized precisely to the needs of the participating organizations, allowing for simplified governance and enhanced interoperability with other business systems..

[Audio] The advantages of consortium blockchains include high efficiency and security with controlled access. They're customizable and ensure data integrity through trusted participation. However, they are highly centralized and lack the broader security that comes from a larger, more diverse network. There's also the potential for misuse by dominant members..

[Audio] Let's look at two examples: Quorum: An enterprise-focused version of Ethereum designed for transaction and contract privacy, often used by financial institutions for clearing and settlements. R3 Corda: Particularly designed for the financial sector, Corda allows transactions to be shared only with those that need to know, thus maintaining privacy and efficiency..

[Audio] The Case of Corda. Corda, developed by R3, is a blockchain-inspired platform that offers both private and permissioned network options. It allows for the development of "CorDapps," which can facilitate transactions in a private and secure manner..

[Audio] In the world of consortium blockchains, we see applications in: Internal business processes such as HR operations or financial reconciliations. Audit trails, keeping immutable records for auditing purposes. Inventory management, ensuring real-time tracking within a specific set of partners. Intellectual property protection and interbank transactions..

[Audio] Here we have the different types of blockchain networks exemplified: Bitcoin which is public and permissionless. Hyperledger Fabric which is private and permissioned. And Corda which embodies the consortium and permissioned model..

[Audio] Time to test what you have learned! What are the differences between public and private blockchains and in what scenarios might each be preferable? We encourage you to take a moment, reflect to what you have already learned and think about the answer..

[Audio] To sum up, Lesson 3 has taken us deeper into blockchain's world, introducing the various types of blockchain architectures: We've discussed diverse blockchain types: Public, Permissioned, and Private, each with its accessibility and governance structures. We've explored the advantages each type offers, from the unmatched transparency of public blockchains to the customized efficiency and control found in private networks. By understanding these concepts, we're better equipped to consider how blockchain can be applied in real-world scenarios, tailored to the specific needs of different industries..

[Audio] Here are the references utilized throughout this lesson..

[Audio] We highly recommend reviewing these materials for a more thorough understanding..

[Audio] Additionally, please consider exploring additional resources for continued learning..

THANK YOU. Disclaimer: The content provided in this course is for informational purposes only and should not be considered as legal, financial, or professional advice. Acknowledgment: The content in this course has been developed as part of the TRUSTFOOD project, funded by the European Union's Horizon 2020 Research and Innovation Programme under Grant Agreement No. 101100804..