Blockchain Technology

Blockchain is defined as a distributed database that allows secure transactions without a central authority. It consists of a series of blocks, each of which are linked to the previous block by means of a cryptographic hash (which guarantees that no previous block or its contents have been changed) and contains a set of transactions from network participants which are being added to the permanent record of what has happened as given below

The first blockchain implementation is the crypto currency- Bitcoin. In this context, the replicated database acts as global ledger tracking all crypto currency transactions between participants. A blockchain transaction refers to any change in state of a digital asset defined on top of it. It is not limited to crypto currency. While first generation blockchains were created for crypto currency application, new generation block chains allows custom digital assets’ definition. There is no central authority for transaction validation here. It is performed by a peer-to-peer network throughout a consensus process.

Two types of entities compose a Blockchain system: Participants, who perform transactions secured by means of cryptographic transactions, are grouped into blocks, which are submitted to a network of nodes, which are to be validated every time. Every time a block is validated, it is broadcasted to the network and added on top of the blockchain. Since every block in the block chain contains a timestamp and a reference to the previous block, the blockchain is fundamentally a time stamping system represented by the chain of all blocks, starting from the first block.

There are two main categories of blockchain which are categorized on the basis of network access permission:

 • Permission less: Network access is free and anyone can set up a node to validate transactions. Bitcoin and Ethereum are the major examples.

• Permissioned: Network access is restricted to a set of known participants. Ripple is an example of permissioned systems.

The blockchain uses cryptography to secure transactions. Participants create a cryptographic key pair with wallet software to interact with the blockchain:

 • A private key is one in which the user must not reveal, since it is used to sign transactions and to unlock crypto currency funds.

• A public key is one where it corresponds to the address of the associated account. It is used from participant to identify the receiver of a transaction.

Digital signatures protocols are employed in block chains, in order to provide authentication and non-repudiation so that only the key-controlling entity can perform transactions from its associated account.

BLOCK CHAIN HAS VARIED APPLICATIONS:

Distributed cloud storage: Block chain data storage will become a massive disruptor shortly since current cloud storage services are centralized thus the users must place trust in a single storage provider who control all of your online assets.

Digital identity: Imagine never having to worry about your digital security every again. It’s a massive problem in the world. Which is now estimated to cost the industry about $18.5 billion annually, according to a report released Thursday by Distil Networks. So for every $3 spent, $1 is going to ad fraud.  Blockchain technology tends to offer solutions to many digital identity issues especially in those areas where identity can be uniquely authenticated in an irrefutable, immutable, and secure manner. Methods at present use problematic password-based systems of shared secrets exchanged and stored on insecure systems.

Digital voting: Using this technology, a voter could check that her or his vote was successfully transmitted while remaining anonymous to the rest of the world, thereby giving enormous security.

Decentralized notary: Another interesting feature is its timestamp feature where the whole network essentially validates the state of wrapped piece of data (called a hash) at a certain particular time. It confirms the existence of at a stated time that is further provable in a court of law, as a trustless decentralized network.

Blockchain is a highly disruptive technology that promises to change the world as we know it. The technology is not only shifting the way we use the Internet, but it is also revolutionizing the global economy. Blockchain has applications that go way beyond obvious things like digital currencies and money transfers. From electronic voting, smart contracts & digitally recorded property assets to patient health records management and proof of ownership for digital content.

Nishita Poddar
Batch 2017-19
Symbiosis Institute of Telecom Management