Muhammad Fuad Khairy

1706058501
Bisnis Digital - D

Blockchain Technology
According to The Economist, Blockchain is a growing list of records, called blocks,
that are linked using cryptography. Each block contains a cryptographic hash of the previous
block, a timestamp, and transaction data. A block will be generated in a blockchain if there is
a new transaction. That newly-generated block will contain a unique hash (concealed in
cryptograph), a hash from the previous block, and the newly-made transaction. In a simpler
explanation, blockchain is a series of connecting blocks that each of it has its own identity
(hash) and contains data that includes timestamp (chronological, hash from a pre-existing
block) and transaction information.
Blockchains have three main characteristics, usually known as the three pillars of
blockchains. They are Distribution (Decentralization), Transparency, and Immutability. By
distribution, all of the blocks that are part of a blockchain will have the exact same copy of
every data transactions that have ever happened in a block. Distribution in blockchain
technology means “every for each”. Instead of having one big ledger storage containing
transaction data, each and every block in a blockchain will have a copy of all of the transactions
data that have ever taken place.
A new block will be added when a new transaction occurs. When that happens, every
block that are part of the blockchain will have a copy of the transaction data. An individual’s
personality is concealed through complex cryptography and spoke to just by their open
location. Along these lines, if you somehow managed to look into an individual’s exchange
history, you won’t see “Sway sent 1 BTC” rather you will see
“1MF1bhsFLkBzzz9vpFYEmvwT2TbyCt7NZJ sent 1 BTC”. This means every person in
blockchain will know the occurrence of the transaction without knowing who made that
transaction since it is being concealed in cryptograph. Hence, it fulfills the transparency and
safety measures.
Each block has its own unique identity, known as hash. Hash has a similar characteristic
to fingerprints for human. It is generated when a new block is created, meaning every
transaction generated will have their own each unique hash. Hash is useful as an identity of the
transaction; it is concealed in a cryptograph and cannot be tampered (changed) after the
generation of it. Those features made blockchains immutable.
There are four types of blockchain networks, but there are only two blockchain types
that is fundamental. Public blockchains are blockchains that have no access restrictions,
meaning anybody with an internet connection can send transactions to it as well as become a
validator. The most known public blockchains are those being used as the base of
cryptocurrencies transactions; they are the bitcoin blockchain and Ethereum blockchain.
On the other hand, Private blockchains are blockchains that have restrictions, meaning
it only can be used if a person has permission from the administrator. Participant and validator
access are restricted.
In my opinion, blockchain have the potential to be the most efficient and effective
method of recording transactions whether it is applied in business, community, or even
governmental purposes. Blockchain is efficient in the way it did not require much processing
time compared to the conventional way of recording transactions. It surely can cut time and
cost in governmental bureaucracy procedure without losing any detailed information in
accordance to the transaction data. Government are able to easily track all detailed financial
transaction of even the furthest town in Indonesia, and by all, it means tracking the whole
governmental transactions even for the furthest town in Indonesia. Although it might not seem
possible in near time, because it needed a huge non-stop amount of power supply if applied in
every place in Indonesia. But government can partially adapt it, for example, applying it in
every tax transaction in the case of business taxation.
In business purposes, private blockchain can be useful to record and track transactions.
Company will be granted an authorization regarding the transaction data, which means
company can control what transaction data involved parties can see and cannot see based in
the usefulness of the data to them. The involved parties can be the customers, suppliers,
retailers, shipping companies, or others that is involved in the transactions. It will greatly
reduce the time needed in the transaction process because whenever a certain condition is met,
transactions will automatically be recorded. It will simplify the flow of transactions since it is
being automated. Hence, increasing efficiency and creating more potential for a company to
be more productive.