Written by Mayuri Joshi
Blockchain technology is most simply defined as a decentralized, distributed ledger that records the provenance of a digital asset. Our guide will walk you through what it is, how it's used, and its history. Blockchain, sometimes referred to as Distributed Ledger Technology (DLT), makes the history of any digital asset unalterable and transparent through the use of decentralization and cryptographic hashing.
A simple analogy for understanding blockchain technology is a Google Doc. When we create a document and share it with a group of people, the document is distributed instead of copied or transferred. This creates a decentralized distribution chain that gives everyone access to the document at the same time. No one is locked out awaiting changes from another party, while all modifications to the doc are being recorded in real-time, making changes completely transparent.
Of course, blockchain is more complicated than a Google Doc, but the analogy is apt because it illustrates three critical ideas of the technology:
>Digital assets are distributed instead of copied or transferred.
>The asset is decentralized, allowing full real-time access.
>A transparent ledger of changes preserves the integrity of the document, which creates trust in the asset.
BLOCKCHAIN EXPLAINED: A QUICK OVERVIEW
Blockchain is an especially promising and revolutionary technology because it helps reduce risk, stamps out fraud, and brings transparency in a scalable way for myriad uses.
A current example is the possibility to track the state of an item in production. RFID gates are installed at different production stages, and tags are being read when an item passes through a gate. Each corresponding reading is being sent to the blockchain as well and can be queried at a later stage. In addition, readings from IoT devices can flow to the blockchain as well, and become part of the permanent record of the production process, providing a picture of the environmental state during production.
The end result is a provenance trail of the production process which can be shared also in real-time with relevant stakeholders.
Transactions on the blockchain create a traceable permanent history of the product or interaction, throughout their lifecycle, which is shared by all members of a collaboration.
The end goal is to enhance trust in a trust-less environment without relying on a single entity to manage all the information. The distributed nature of information sharing provides an undeniable single source of truth reflecting reality as it took place.
As a part of the vision to incorporate a blockchain-based supply chain tracking and tracing application, the first step is to incorporate the partner's data, putting a specific emphasis on IoT data. The data serves as the driving element to the agreed-upon logic which resides in the blockchain level as well in the form of smart contracts. Examples as to the kind of data which shall participate include data coming from sensors enabling tracing the state of items in real-time and to drive potential notification on out-of-bounds conditions affecting the agreement (for example, too high humidity levels).
One of the advantages enabled by the blockchain as the underlying technology is to provide accurate real-time distributed visibility fed by collaborators data. This capability enables a coherent and updated view of the status of the supply chain ecosystem including the flow of materials and components, and the associated state as can be reported by attached IoT devices; all according to the scope, rules, and conditions agreed upon among the network partners. This includes tracing the state of production and making this information available to the buyer.
Blockchain is one of the emerging transformative technology of the 21st century. While it may have origins from cryptocurrency and Bitcoin, its applications sure go far beyond those. It draws its name from the cryptographically encrypted chunks (called blocks) where information is stored. This information is encrypted data which is a cryptographic hash map of the previous data, timestamp, and new data. The next successive block contains information about the last block by forming a chain, hence the name Blockchain.
It provides an architecture that allows us to trust on a decentralized system (Internet or Web) rather than trusting any actor within it. It is a ledger that is shared between multiple entities that everyone can inspect, but not any single user can control it. This also eliminates the middleman in the whole transaction process. Since the privacy of the Blockchain is maintained by high-end cryptographic hash functions and public-key cryptography, it offers enhanced transparency and fairness while also saving businesses time and money. Ever since Satoshi Nakamoto had published his paper on Blockchain with the implementation of Bitcoin, this technology has been through massive updates that resulted in numerous applications of Blockchain. Some of these are:
Banking: With the help of Blockchain, transferring money or funds from one to another person can be done in a second because the validation of the transaction will take place by uses of Blockchain and cryptography. This will also reduce the chances of hacking. It can also undercut hard money lending by allowing a stranger to loan you money and taking your smart property as collateral. Either way, there would not be any need to show the lender credit or work history, nor manually process the numerous documents. Companies: Chainalysis, Circle
Healthcare: Here, personal health records could be encoded and stored on the Blockchain with a private key that would grant access only to specific individuals. This database will be highly secure and for checking the data related to the patient. Doctors have to log in there with the public key in case he wishes to check the data of the patients. Companies: MedRec, Nano Vision,
Internet of Things: IoT has millions of applications, and with devices and sensors getting added to the framework every minute, the concerns about the safety of data collected from these sources increase too. Blockchain-infused IoT adds a higher level of security to prevent data breaches by utilizing transparency and virtual incorruptibility of the technology to keep things smart. Its ledger system ensures that information is only accepted and released to trusted parties. Further, by encrypting IoT devices on the Blockchain, it protects your ownership and enables transferability.
Blockchain - Conclusion. ... Bitcoin is the first successful implementation of blockchain. Today, the world has found applications of blockchain technology in several industries, where the trust without the involvement of centralized authority is desired. So welcome to the world of Blockchain.
Blockchain technology is revolutionary. It will make life simpler and safer, changing the way personal information is stored and how transactions for goods and services are made. Blockchain technology creates a permanent and immutable record of every transaction. This impenetrable digital ledger makes fraud, hacking, data theft, and information loss impossible.
The technology will affect every industry in the world, including manufacturing, retail, transportation, healthcare, and real estate companies as Google, IBM, Microsoft, American Express, Walmart, Nestle, Chase, Intel, Hitachi, and Dole are all working to become early adopters of blockchain. Nearly $400 trillion across various industries is set to be transformed by blockchain.