What is Blockchain ?
Blockchain is a globally recognized term among the IT community; however, it's not a globally understood technology. Most of the people think of Blockchain and Bitcoin both as a same thing. Blockchain, however, is much more than a cryptocurrency platform. Blockchain is a decentralized database that keeps a permanent record of all transactions. Once a record is written to a blockchain, it is unable to be altered. To better understand blockchain, it's important to be familiar with the concepts that lead up to blockchain
Blocks are the basic unit of information in blockchain. Recall that a set of transactions results in a new block being created and added into the blockchain after the previous block.
A block itself has three primary components. The block is made up of the information for the current transaction, a cryptographic hash of the previous block, and a time stamp.
How Blockchain Helps Bitcoin ?
The cryptocurrency Bitcoin is likely the first example of blockchain that you heard about. You may not have even know it was blockchain-based.
Bitcoin is a decentralized digital currency. That means it’s not issued by a central bank. It also doesn’t have a single entity controlling its value or distribution.
Bitcoin is designed to prevent counterfeiting or duplication of funds.
As blockchain's use has grown, additional cryptocurrencies have been created. The reason blockchain is so important to cryptocurrency is that it prevents currency from being duplicated. Someone can’t simply go in and edit the amount of currency they have. They also can’t spend the same currency twice—as soon as the currency is spent, it’s transferred to the new holder and the old holder can’t double-spend it.
Having a complete, detailed transaction history for cryptocurrency is crucial for trust in cryptocurrency. Blockchain provides this complete, detailed history. What are some other use cases that might benefit from blockchain?
Example's Of Blockchain
Supply Chain
Grocers are starting to recognize that blockchain enables origin-to-destination tracking with detailed information every step of the journey. They can see the information at harvest, such as date, temperature, location, method, and so on. They can track the items from harvest all the way to checkout. They can monitor how long the item sat in a warehouse, how long it spent on a train or truck, and how long it’s been sitting on their shelves. In the case of a foodborne illness, they can quickly isolate all the inventory from a specific plant and immediately know which of their customers purchased that inventory.
Shipping Services
Major international shippers are starting to use blockchain technology to monitor shipments. Blockchain provides shippers with several valuable tools to maintain control of their customer’s property. Every touch-point or interaction can be tracked and logged. Blockchain’s consensus mechanisms ensure that all the data included is the data that was entered—nobody has manipulated the data after the fact. And finally, the record contains the entire history of a shipped item, from entering the shipping system through delivery.
You should now understand some of the basics of blockchain. Now, you will examine some of the benefits that blockchain provides.
What is Ethereum ?
Ethereum is a permission less cryptocurrency blockchain that provides a broad set of capabilities for using smart contracts, running applications, and executing code. Ethereum currently operates with a proof-of-work consensus mechanism. Ethereum 2.0 is intended to use a proof-of-stake consensus mechanism, reducing the compute intensity, but prioritizing members with more coins (or Ether).
Benefits of Blockchain
Decentralization
Decentralization means that each member of a blockchain has a complete copy of the data. Each member having a copy of the data protects against bad actors, improves disaster recovery, and promotes high availability.
Transparency
Another piece of blockchain that increases trust is transparency. Transparency means that the information stored in the blockchain is visible to the members of the blockchain. Blockchain maintains a complete record of all transactions, and that record is available to every member, making blockchain a very transparent technology.
Immutability
Immutability simply means something cannot be edited or changed. You can update the information in a blockchain by adding data, which will be added in a new block. However, once a block is part of the chain, the information in that block can’t be changed.
Auditability
Auditability is another benefit of using blockchain. Auditability speaks to how readily available and accessible something is to audit. Blockchain, relying on the other benefits already discussed, is a very auditable platform.
Other uses of blockchain
Blockchain’s immutability, distributed nature, and transparency offer benefits that span far beyond cryptocurrency. From healthcare applications to government, and agriculture to finance, blockchain is just beginning to be tapped and isn’t near its full potential.
1. Healthcare
Blockchain in healthcare has multiple potential use scenarios. Consider patient care records. Creating a Hyperledger Fabric blockchain with channels would allow all providers to securely and confidently share patient information. Each office or hospital visit would be documented in an immutable archive. Each provider could see which notes were entered previously, when they were entered, and who entered them. The providers would also be able to review any previous updates to the health record. Knowing that nobody can delete information without a record of it, the provider and hospital also have an increased confidence in the completeness of the health record.
2. Government
Government is an area with the largest potential for blockchain adoption and use. In the government sector, everything from voting to procurement, taxes to public health, has blockchain potential.
3. Agriculture
As discussed early in this training, agriculture is a natural industry for blockchain. The ability to track an item from the farm where it was harvested all the way to the final destination gives consumers greater confidence in the manner and method in which items are harvested.
4. Finance and commerce
Finance and commerce is another segment with broad potential for the adoption of blockchain as the technology matures. The decentralization and immutability of blockchain make it an ideal match for finance and commerce transactions.
As blockchain evolves, its impact will cross all sectors. Some sectors are already getting involved in blockchain to see how they can expand the use beyond the initial focus on cryptocurrency. Blockchain’s inherent nature—immutable, transparent, and decentralized—makes it well positioned to help solve business problems in an ever-changing e-commerce world.
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