In today's blog, we'll know about blockchain technology.
Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network. An asset can be tangible (a house, car, cash, land) or intangible (intellectual property, patents, copyrights, branding). Virtually anything of value can be tracked and traded on a blockchain network, reducing risk and cutting costs for all involved.
There are three types of Blockchain:
Public Blockchain: This is the Blockchain network where anyone can join the network, transact in it and become a validator in it.
Private Blockchain: This is the Blockchain network where the network administrators invite others and grant membership to get access rights.
Consortium Blockchain: This is a semi-decentralized Blockchain network. It also requires permissions, but a single organization will be running a node of Blockchain.
Understanding Blockchain with an Example
Let’s consider a scenario where there is a Blockchain network, and all have the database having the house address of people, and the rule is – only the house owner can change his house address. So, let’s say Mr. A being a house owner, raises a query to change his house address, and the query is shared across the network. People know that A is the owner and them consent (note that the power of consent is codified and not at the will of the person), and the address gets changed in everyone’s database. Any changes that compromise the integrity of the databases will not be entertained by Blockchain, which is why Blockchain is called the Trust Protocol.
Required skills to learn this technology:
Good mathematical and coding background.
Management and marketing are equally important if you want your product to survive.
Applications of Blockchain Technology
We are all very well aware of the cryptocurrencies like Bitcoin, Ripple, Etherium, etc., which employ Blockchain as their underlying technology.
They can be employed in patents, copyrights, and smart contracts for properties. These would thus hold the log of who owned it, to whom they sold, and again, there cannot be multiple sales/purchases of the Sold ones.
Many banking services are employing Blockchain for validation and authentication purposes.
Companies that deal with e-commerce businesses will be able to manage their supply chain by employing Blockchain.
Advantages of Blockchain
There are many advantages to using blockchain technology compared to other traditional technologies.
With blockchain, your business process will be better protected with the help of a high level of security
The hacking threats against your business will also be reduced to a greater extent.
As blockchain offers a decentralized platform, there is no need to pay for centralized entities or intermediaries’ services.
Enterprise blockchain technology enables organizations to use different levels of accessibility.
Organizations can do faster transactions with the help of blockchain.
Account reconciliation can be automated.
The transactions done are transparent and hence, easy to track.
Disadvantages of Blockchain
The disadvantages of blockchain technology are...
Blockchains use excessive energy.
Blockchain is not a huge distributed computing system.
Mining does not provide network security.
Blockchain entries do not last forever or are not immutable.
Scalability remains blockchain’s weakness.
Blockchain is not indestructible.
What are the Hurdles in Adopting Blockchain?
This requires research and skill. So, the very first hurdle is knowledge and understanding.
The speed of transactions, data management, and verification will involve a lot of fast innovation, and adoption becomes challenging.
Coming up with ways of adopting Blockchain technology along with traditional mechanisms (like in the banking sector) is difficult.
There is no global standard on how Blockchain must act! All we know is – how it works.
‘Anonymous’ and ‘irreversible’ kind of Blockchain attributes might not be appreciated by all users because of different use cases.
The major obstacle would be convincing society to adopt this technology.
Thus, Blockchain is a gem and jewel in the platform of storing, validating, authorizing and transacting online in this world where the final and biggest question is on the question of trust.