What exactly is Blockchain?
What exactly is Blockchain?
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.
Blockchain the reason we are going to talk about that is that we need to create a common language across Business and Technology about this issue unbolt Einstein once said that if you cannot explain it simply you do not understand it what enough the goal today is to explain it simply so everyone understands it well enough ok so the first thing that we need to understand are two basic terms Bitcoin and blockchain.
Bitcoin is a digital coin it's money that is digital we are not going to talk about this Bitcoin at this talk. We are going to talk about blockchain. Blockchain is a technology that enables moving digital coins or assets from one individual to another individual. It's very important to understand that bitcoin is not blockchain. It is important to understand our common language because I heard that compliance people are saying oh, we cannot talk about Bitcoin maybe because it has a bad reputation. But about blockchain, we should and can talk so, after we understood the basic terms of Bitcoin and blockchain. It times to go into the problems a blockchain attempts to solve and the problem is money transfer.
I'm going to explain it at the conceptual level at the same for Bitcoin only to focus on the concept. I'm not going into the implementation details of how it is done in practice the important thing is to keep in mind is asset concept only so today if a person wants to move money or transfer money to a person. B let's say from the US to Japan this is typically done using a third trusted party and it is typically working as follows. First of all, they say, I want to move transfer to be and all there is a third party to transfer money to be the trusted party. Because it is trusted identify be in Japan identifies that as a person and the bank account and then move the money after taking some faith to say write account in Japan this typically takes about three days or more. But it takes some time what blockchain is attempting to solve is first to do the transfer money without the trusted entity at the minim. So people can talk with each other second to do it faster than three they immediately and third to do it cheaper.
Then the fee ,that the third party collects so let's dive into how blockchain addresses this money transfer problem.
Concept of the Open Ledger
The first principle that, we are going to talk the first concept is the concept of the open ledger and I'm going to illustrate this concept using an example, let's say that we have a network of four people that wants to move money from one another and let's assume that at Genesis at the moment of the inception of this network, A has $10 from the beginning. Now let's see the concept of the open ledger, and how it is being implemented in the block. Let's say that A wants to move to be five donors, what is going to happen is that, we are going to add a transaction. A move to be $5, and we are going to link it into the already existing transactions. Then let's assume that B wants to move to D $3, so we are going to do the same, we are going to link another transaction into the ledger into the chain that says B moves to D $3. Finally, if you want to move one donor from D to C. Again we will do the same process the move to C1 donor, and we link it to select to say open ledger, so this is the concept of the open ledger. It is essentially a chain of transactions and this is one of the reasons that, this is called the blockchain.
I'm not going to talk about the blocks these are implementation details which you will leave aside for a moment but this is a chain of transactions that is open and public to everyone what it gives us is that everyone owns the network can see, where the money is, how much money each one has in its pocket. First and second everyone can decide whether a transaction is valid or not. Fine for example if A, now attempts to move $15 to, sees everyone owns the network can immediately, see that this is not a valid transaction. Because they started with them move out to be another five, and he does not have $15, and this transaction will not be added to the open legend. This transaction will not be part of the chain.
Now we can move to the second principle of look that, we have a centralized place. Now that managing the ledger but remembers that the blockchain goal is to get rid of the centralized place. So the second principle is a distributed ledger which means blockchain is going to change the centralized, one and distribute it across the nodes in the network which means D for example, can have a copy of the legend and can hold it in his note. A can do the same and have a copy of the ledger and anyone else participates in this network and Holland’s allege can horn a chain of events that happens. Now what we got is that the ledger is distributed and essentially, we don't need anymore. The centralized place that holds the ledger we achieve the goal we got rid of the centralized trusted party, however, we created another problem or a new problem now when there are various copies of the ledger in the network. We need to make sure that all these copies are synchronized and all the participants in the network see the same copy of the ledger.
The same version of the ledger and leads to the third principle of blockchain which is probably the most interesting one. We are understood already that the legend is open anyone can see it the ledger is distributed across various nodes, and now what we need to understand is how in this kind of distributed ledger nodes understand and synchronize the better across and stuff. We are going to do that using an example. Let's say that B wants to move to C 5 dollars, what B is going to do. B is going to publish and broadcast this intended transaction to the network everyone in the network will see immediately that B wants to move $5 to see this is an invalidated transaction.
Concept of Miners
It is not getting yet into the letter in order. To get into the letter we need to understand the concept of miners. In Bitcoin, miners are special nodes that can hold the ledger in this case let's say that D, and A, are miners. Miners are going to do the following thing. Miners are going to compete among themselves, who will be the first to take this transaction and validate that one and be able to validate and put it into the ledger the first miner that will do that will get a financial reward in this case Bitcoin. Let's try to understand what it means to win the competition. To be the first that can take the transaction and add it to the ledger. A miner needs to do two things first thing needs to validate the new transaction. Is the ledger is open? And you can immediately calculate whether B does have the funds to make the transfer. This is easily the same the second thing that a miner needs to do is to find a special key that will enable this miner to take the previous transaction. And to this previous transaction lock the new transaction to find this scheme. This miner needs to invest computational power and time because this search of the key is random the miner is repeatedly guessing new keys. Until it finds interest that matches this kind of a random puzzle the first one that will do that will get them financially. Let's see how Ledger's are synchronized across the network. The minor was able to solve the puzzle and be able to take this transaction and edit it. To say it's a ledger, what he is going to do now is going to publish the solution to save time network to broadcast. It to the entire network which means, he would say here is a validated transaction, and here is the lock here is a key that enables everyone on the ledger on the network, sorry to take it and edit to serve on ledges. What all miners are going to do a, for example, see that this transaction is already validated and can be added to the ledger. This means there is no point in trying to resolve this transaction and get a reward. A will immediately take this transaction to add it to its ledger. And we look for another transaction to work on and hope to get the reward next time. Let's try to summarize what we did, or what we learned.
We try to explain how blockchain works, we learned that blockchain is not Bitcoin. There are two different things, we learned that blockchain is based on basic principles of the fact that the ledger is open and public, such that everyone can see and vide eight transactions. The fact that the ledger is distributed and essentially exists in many nodes on the network removes the dependency on the third party. We learned about the concept of miners, who are special nodes in the network that their role is to validate transactions and adds to the ledger. We touched only on the fact that the economic incentive of miners essentially ensures that collectively they agree what is the official Ledger’s that should be used by everyone. We need to remember, and I ask you to remember that this explanation is very simplistic. It only about the concepts and ideas behind blockchain the implementation, itself is much more detailed and complex and answers probably a lot of questions.
Real-Life Examples of Blockchain
How about we investigate a portion of this present reality utilization of blockchain innovation across different enterprises, which show substance past the promotions about, we investigate a portion of these present reality utilization of blockchain innovation across different enterprises, show substance past the promotion.
1. Medical services
The patient, being the essential issue of the medical care biological system, has the option to precise data. It can likewise be investigated as an issue of life and passing. Protection and security of wellbeing information are vital. It helps in following the serials and clump quantities of doctor-prescribed medications. Emergency clinics have moved away from paper for recordkeeping and they use blockchain innovation to store patient information, which is kept private. The patient would be given a number key to get to these records, in this way keeping him in charge of who can see that information. Patient judgments can likewise be put away, to follow the patient's wellbeing history.
2. Inventory network the executives
Blockchains increment the general effectiveness of supply chains. It gives precise distinguishing proof of the area of things on the store network. It accordingly eliminates the requirement for a paper-based path. It forestalls misfortunes and screens the nature of items while underway.
3. Advanced IDs
With an expected 1 billion individuals worldwide not having a character, Microsoft is chipping away at making ids to enable ruined individuals and displaced people. This would help in connecting them with the formal monetary area. It plans to do this through its Authenticator application. The authenticator doesn't simply utilize a secret phrase. It utilizes an additional layer of assurance that uses a code or a token to recognize a returning client or a gadget. It is an ideal route for clients to control their advanced personalities.
4. Sanitation
Interesting utilization of blockchain in sanitation is the capacity to follow your food from its starting point to your plate. Utilizing the unchanging idea of blockchain, the vehicle of food items from their starting point to the general store can be followed. On account of food-borne diseases, the wellspring of the foreign substance can be followed rapidly and precisely.
5. Land Record
Proprietorship and title subtleties are put away on the blockchain, along these lines making it simpler to move possession and follow possession. Taking out paper from the condition offers a clear image of lawful possession. Titles are put away on the blockchain arrange and can be seen, adjusted, and refreshed at whatever point required.
6. Information sharing
Presented by IOTA, a circulated record innovation created by the IOTA Foundation, it includes utilizing the blockchain to share or sell unused information. The unused information heaps of ventures could be directed to places that need it the most. Blockchain can be utilized as a commercial center to store information which can be utilized to improve a large group of ventures.
7. Weapons following
Blockchain innovation would empower the national government and law authorization to follow weapon or firearm possession. It will go about as a constant and straightforward vault which will likewise help in tracking weapons sold secretly.
8. Wills or legacies
Paper wills or legacies would now be able to be supplanted with computerized ones which can be made and put away utilizing the blockchain network. It should be utilized alongside savvy contracts as it would make your report both legitimately restricting and completely clear regarding who ought to get which resources when you die. This settles your finish of-life concerns.
9. Computerized casting a ballot
Citizen misrepresentation has consistently been an extraordinary concern. It won't be any longer. You can make the most of your vote genuinely with the changeless idea of the blockchain. It will make casting a ballot straightforward and any progressions made to the organization would be seen by the controllers. The token-based framework made utilizing blockchain innovation will guarantee the arrangement of 'one unchangeable vote for each individual.'
10. Copyright and eminence security
Copyright and proprietorship laws on music, recordings, websites, and other online substance are an unquestionable requirement in the present day and age. These laws can be made secure through blockchain innovation. Advanced substance downloads would be a decent choice as it guarantees that the craftsman or the maker of the substance likewise gets something reasonable. Blockchain would likewise give continuous and bona fide sovereignty dispersion information to content makers and performers.
Blockchain innovation is a development which has been embraced by a larger part of individuals. In spite of the fact that the functionalities of blockchain are exemplary, one necessity to recollect that it isn't the answer for each issue and that diverse blockchains will suit an assortment of requirements and conditions. The utilizations of blockchain will broadly differ from one industry to the next.