Blockchain is a digital ledger of transactions that is distributed across a network of computers. It makes transactions difficult to modify by requiring consensus from multiple participants. This addresses the issue of trust in current systems. Blockchain provides decentralization by not vesting control in a few central authorities. It uses a distributed network where the same records are maintained by many peers. Consensus rules require a majority of nodes to verify each new block before it is added to the chain, making the records immutable. Industries like banking, cyber security, voting and transportation could be disrupted by blockchain applications like cryptocurrency transactions, smart contracts, and distributed public records and registries.
2. What is Blockchain & Its Purpose
Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack,
or cheat the system. A blockchain is essentially a digital ledger of transactions that is duplicated and
distributed across the entire network of computer systems on the blockchain.
Gap in the Current System being fulfilled by Blockchain = TRUST
Fundamental of Blockchain Technology:
1. Decentralization: The control will not be vested with a few central authority (Intermediaries), so the
probability of tempering with the records will be reduced.
2. Distributed Network: Same record is maintained with millions of other members/peers available on the
network.
3. Consensus Rule: Whenever a block is added, that will verified & validated by majority of the nodes/peers
make it valid. Only then block is added to the Chain.
4. Immutable: A tempered block can be easily identified and replace with the correct block available on
majority of the database created on millions of other members present on the network.
3. Operation and Securities Features
Each Block created have 3 elements:
1. Data: Every transaction or any kind of data is stored inside the Block in encrypted form
2. Hash of Current Block: A hash number is created based on the data unique to every block
3. Hash of the Previous Block: Hash of previous block to which is attached is also mentioned to maintained the
the chronological order of the Blockchain.
Features:
1. Dependent: Any change inside a single bock will make the whole chain invalid due to the dependencies
created between the blocks.
2. Distributed Nature: Same Blockchain is stored in several other systems/peers on the network, so the
tempered blockchain can be easily identified and replaced.
4. Application and Industries Effected
Application of Blockchain:
1. Transaction Settlement: Payment can be made across the world without the need of any intermediary like
banks. Example- Bitcoin, other cryptocurrencies.
2. Smart Contract: Ethereum Blockchain has the ability to make self executory contract. The terms of agreement
will directly written into codes. The code and the agreements contained therein exist across a distributed,
decentralized blockchain network.
3. Registries: The registry documents which currently maintained with a centralized authority can be maintained
on Blockchain Network. It will eliminate the centralized authorized maintaining all records, thus reducing the
the probability of tampering.
Industries going to be Disrupted or effected:
Banks, Cyber Security (Public Data), Voting, Online Data Storage, Private Transport & Ride sharing (Uber, Ola),
Online Music, etc.
