IBM Blockchain Technology
Now-a-days Business networks are inefficient because all participants in the business network maintain a ledger of all transactions that take place in the business. This process seems to be inefficient due to its cost. This process is expensive because of duplication of effort and intermediaries adding costs for their services.
One solution to this problem is blockchain, which provides a shared ledger technology that allows any participant in the network to see the one system of record, or ledger. By using blockchain technology, businesses can benefit from a more efficient transfer of goods and services.
The following videos in the next module describe business networks and transactions, the problems that blockchain can solve, what blockchain is and how it works, and key use cases.
A Shared ledger is a type of database that is shared, replicated, and synchronized among the members of a network. There is no central administrator or centralised data storage. All participants within a network can have their own identical copy of the ledger. Any changes to the ledger are reflected in all copies.Every record in the Shared ledger has a timestamp and unique cryptographic signature, thus making the ledger an auditable history of all transactions in the network.
With all transactions being added to a single public ledger, it reduces the clutter and complications of multiple ledgers.
Smart contracts are self-executing contracts with the terms of the agreement between buyer and seller being directly written into lines of code. The code and the agreements contained therein exist across a distributed, decentralized blockchain network. Smart contracts help you exchange money, property, shares, or anything of value in a transparent, conflict-free way while avoiding the services of a middleman.
Because the rules are so secure and easy to follow, even simple devices like phones or locks can be programmed to obey what everyone has agreed to. And the way of doing this is strong enough that attackers or malfunctioning computers can’t break the rules that have been set up. As long as it’s built right, not even the person who makes the app will have the power to break the rules they agreed to.
Privacy is of utmost importance at the Blockchain group of companies. Blockchain, and its encryption features allow high degrees of security and privacy.
Privacy in blockchain can be explained in 3 terms.
Privacy: Appropriate confidentiality between subsets of participants are secured and User identity not linked to a transaction by way of transaction history on the Blockchain
Fungibility: Every coin is worth the same value and is thus mutually interchangeable. No coin risks potential blacklisting nor debasement due to deprecating transaction history.
Decentralization: All nodes have equal power and control; there are no nodes that have more influence than others, i.e. masternodes. The currency is not created, maintained nor represented by any one person or company, i.e. a central authority
Privacy on Blockchain is one of the major features that attracts users towards the technology.Despite its decentralized nature and the ability for anyone to view every transaction or data transfer on Blockchain, encrypted communication prevents third party interference with messages sent across the technology.
Trust is the key element of blockchain technology. When transactions are executed and settled on a distributed ledger, counterparties don’t need to have an established trust relationship. If each participant in the transaction trusts the blockchain itself then they don’t need to directly trust each other.
In Blockchain community, each member maintains his own copy of the information, and all members can validate any updates collectively. The information could represent transactions, contracts, assets, identities, or practically anything else that can be described in digital form.
Entries are permanent, transparent, and search-able, which makes it possible for community members to view transaction histories. Each update is a new “block” added to the end of the “chain.” A protocol manages how new edits or entries are initiated, validated, recorded and distributed.
Crucially, privacy can also be selectively enforced, allowing varying degrees of anonymity or protection of sensitive information beyond those who have explicitly been given access. With blockchain, cryptology replaces third-party intermediaries as the keeper of trust.