Sunday, 15 September 2019

How does BlockChain works for the Business?

     

       Blockchain is a distributed database, and unchangeable record of asset Ownership. It is primarily defined as a shared immutable ledger. It is global, peer-to-peer and distributed immutable record of transactions. It is used to transfer and permanently record any changes of assets between two or more parties without intermediaries. We can manage any types of assets like tangible and intangible assets in blockchain. Assets are defined as anything of value that requires accountability of ownership. ie, crytpocurrency, money, identity, personal property, real estate etc., Blockchain extensively uses the Ledger which is 7000 year old technology to document important events. The development and implementation of ledgers allowed human societies to grow and expand beyond simple village. We simply add a new record to the end of the ledger indicating that the previous data point is no longer in the current status or situation. In order to update this ledger and to keep in sync across all nodes across the network, the network needs to compare all the different ledger copies and determine the version of participants have in common. This is known as group consensus. Blockchain uses the cryptography which is the study of how to encrypt or encode messages so that two people communicate safely and securely in the presence of adversary bad actor. Blockchain uses the cryptographic hashes that are unique identifiers for piece of data and compelling solutions architecture using peer-to-peer format. Whatever the data we commit is that the participants are nodes on the network must agree upon.
        Blockchain is a record keeping system to record or keep records regarding the transfer of digital assets of cryptocurrencies of items. It can be used to store medical data on updating medical record, to record ownership of non-monetary assets like house or car. It is widely used to document the fact that you have achieved certain things like certification, test results meeting certain standards etc. Blockchain is an event tracking system that we can record when significant event occur and then take action on those events. Smart Contract that we can write on the blockchain gets invoked and executed anytime a certain type of event is recorded.

Benefits of Blockchain: In Blockchain, you have the data which can be publically verifiable. If you need to build a solution where you are accountable to large audiences or customers or end users, the blockchain is a attractive platform to build that solution. It is incredibly secure platform. This is an essential solution when you compare the traditional database where the data only exists in one place and if that data hacked or corrupted or altered. In Blockchain, we have so many copies of data floating around on that network. Also, it is a great platform for tracking origin of items and ensuring certain level of quality exists. The blockchain is the good platform when you need to build a solution for your customers, stakeholders, vendors, partners etc., to uphold a certain standard of quality and allows businesses to operate faster. When you use blockchain, you get a solution which is fully distributed that means it has a unlimited fault tolerance as long as two nodes on the blockchain network that are able to communicate and transact anybody on the planet.
      If you are running a blockchain node or miner or if you have a node on the network then you need to keep the copy of the ledger every time a transaction is announced. That transaction gets broadcasted to all participant of nodes on that network. Each participant updates the copy of the ledger they add in that new transaction. It means once we reach group consensus and set of data that is shared by majority of participants then we can query that data from any node on the network and get the same answer. If different nodes on the network gave different answers, then we wouldn't reach consensus. These consensus can be achieved through proof of work or proof of stake.

Types of Blockchain: We can simply read the data in the blockchain which has already been committed and add new data. We chain all of these blocks of data together by including a hash or digital thumbprint of data of the previous block inside the header of the current one. As you get into the blockchain, there are,
    *  Public Vs Private  (Who can Write data to the Blockchain?) and
    *  Open Vs Closed (Who can Read data from the blockchain?)
       It is helpful for you and your stakeholders to think about where it is the bulk of the solution lie. In public blockchain, everyone or large audiences have the ability to WRITE data to the blockchain. It doesn't have no native sense of identity and don't know who our users are. So, there are
two choice that we can elect to show none of the data to anybody at anytime. The second approach doesn't add a value of open public platform like ethereum have opted to show all participants at all times in the world. For ex., Etherscan.io shows the real time transactions against the ethereum blockchain and who is trading back and forth, particular wallet of transactions that gone through the account and the account interacted with. In real world, the usecases like music, and content distribution where you want to sell your work directly to your fans and consumers rather than going through a publishing company to publish a new chapter of book in every 2 weeks. Your fans subscribe your work on a chapter by chapter basis. This also removes much of time delay in traditional content publishing.
       In Blockchain solution, you must first know the identity of the users. If you don't the know the identity of the user, it is impossible to determine what permissions or abilities should applied to that user. In the private blockchain, certain participants or small audiences have the ability to create new record. Hyper ledger is  an example for private closed permission platform. In Open Blockchain platform, where everybody consumes or extremely large audiences are able to consume or read data of the ledger whereas closed platforms allows small populations or groups consume that ledger data. In private closed platforms like hyper ledger which aim for blockchain enterprise solutions. It gets lot of attention in inventory management. How do manufactures and suppliers share inventory data and consumption rates on truly shared infrastructures and How do we allow manufactures to operate even more on lean than they currently are etc.,

Block Creations in Blockchain: We can think of block as a sheet of paper with 25 recorded transactions. Now, we are going to document transactions that occur as they're announced to us. If we are all staying in sync, every 25 transactions we will have a filled up a page. If the data recorded on our page is shared by the majority(ex. >51% of participants) then that version represents the truth. If any participant has different version of data, it will discard their version and get a copy of our most recent sheet of paper. Blocks in the Blockchain are numbered in ascending order, 0 is the first and oldest. The number is the height of the block. When we create a new block, we cryptographically link each new block to the one that came before it. So, there is traceable and unbreakable link from most recent block all the way back to the very first block where the genesis block it is known. Once we validated a block and we seal it and add it to the blockchain which are read only it gets committed to the permanent ledger where it never be updated or deleted. Blocks are created against a schedule. For ex, In bitcoin, we strive to create a block in every 10 minutes and ethereum aiming to create a new block every 14 sec as possible. We store a hash of all the block data a digital thumb print of a unique identifier which can be generated by the data contained on that block. The blocks are chained together on the blockchain by the hash stored inside the header. Meta data is the version number of the software protocol that is being used. Merkle Trees and Merkle roots simply gives the index that we can access the data in a consistent time. It is like an index in textbook which is easy to find a piece of data. The block header contains the timestamp when the block gets created. It contains a piece of data called the nonce which is the proof of consensus.

Blockchain and Web 3.0: It is a 3rd generation of internet of value communication for the smart devices and programmable money. It removes the intermediaries that we were needed to gain access to the financial services in order to do things that large organizations can do. This new business model opens up in web 3.0 are going to see individual consumers being able to do things that are traditionally reserved by richest organizations. The area that is getting lot of focus is identity management. Having a reputable identity management solution is a cross cutting concern to so many interesting and compelling blockchain usecases. Blockchain is safe, secure and reliable identity management store.
        Blockchain provides single shared infrastructure and one source of truth to design a solution. We need the blockchain technology when we could not use the traditional database to meet your needs. It is a powerful platform and enables to solve many types of problem as well as existing problems. Blockchain is a tool which you need at secure network transfers that has high degree of value or assets expressed as digital objects. It is great platform to automate the business process to build a solution around QA/Compliance/Audit might use to review your activities and your business. Hyper Ledger will be used when you need to share different parts of your data with different participants in the network at different times under different conditions. Ethereum built-in architecture provides fractional asset ownership of token or digital coin that represent the platform utility.
   

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