Blockchain Technology

Contents
• Definition
• For what purpose the technology created
• Characteristics of blockchain
• Transaction Cycle(how it works)
• Pillars
• Frameworks
• Public vs Private Blockchain Frameworks
• Advantage and Disadvantages
• Basic Features
• Conclusion
 Definition
 A Blockchain
 It is a growing list of records, called blocks, which are linked
using cryptography.
 Each block contains a cryptographic hash of the previous
block a timestamp, and transaction data .
 It is “an open, distributed ledger that can record transactions between
two parties efficiently and in a verifiable and permanent way.
 It is an incorruptible digital ledger of economic transactions that can be
programmed to record not just financial transactions but virtually
everything of value.
 The Blockchain is a simple yet ingenious way of passing information
from A to B in a fully automated and safe manner.
For what purpose it first evolved…?
• Blockchain firstly created to track money
transfer problem.
• But now, it is functional for different
businesses
 It’s Characteristics..
 It is not owned by a single entity, hence it is decentralized
 The data is cryptographically stored inside
 The Blockchain is immutable, so no one can tamper with the
data that is inside the Blockchain
 The Blockchain is transparent so one can track the data if
they want to
 Each of these blocks of data (i.e. block) are secured and bound to
each other using cryptographic principles (i.e. chain).
 The Blockchain network has no central authority..
 A Blockchain carries no transaction cost. (An infrastructure cost
yes, but no transaction cost.)
Transaction cycle of Blockchain
 The Three Pillars of Blockchain Technology

• There are three main properties of Blockchain Technology

which has helped it gain widespread are as follows:

1.Decentralization
2.Transparency
3.Immutability
 Cont..
1.Decentralization
 The information is not stored by one single entity. In fact,
everyone in the network owns the information.
 If you want to interact with someone / with your friend then
you can do so directly without going through a third party
 Cont..
2.Transparency
 a person’s identity is hidden via complex cryptography and
represented only by their public address.
 while the person’s real identity is secure, you will still see all
the transactions that were done by their public address.
 It adds that extra, and much needed, level of accountability
which is required by some of these biggest institutions.
e.g. you will not see “Bob sent 1 BTC” instead you will see
“1MF1bhsFLkBzzz9vpFYEmvwT2TbyCt7NZJ sent 1 BTC”.
 Cont.…
• So, while the person’s real identity is secure, you will still see all the
transactions that were done by their public address.
 Cont.…

3.Immutability
• Immutability is a blockchain feature that persists
data forever, free from censorship and despite the
disincentives to do so for some period.
• No one change the information ones recorded to the
blockchain
 Advantage and Disadvantages of Blockchain
Technology
• Advantages
 It allows for anonymous transfers of value.
 Using blockchain technologies, anything which holds value can be transferred
from one person to another safely and anonymously.
 It allows users to be in full control over their information.
  Users are always in control of the information they share about themselves
and the transaction they wish to complete.
 It offers a greater level of transparency.
 Blockchains are all viewable by the public. That means there is a level of
transparency available to the transactions that cannot be found with other
currency options
 Cont.…
 It offers a certain level of process integrity.
 When using blockchains, users can trust that a transaction will be
executed based on the published protocols.
 There is no need to have a third-party involved for this process
because the integrity of the process is required for the transaction to
take place.
 It eliminates the need for an intermediary.
 Because blockchains provide a verifiable transaction to a large
peer-to-peer global network, the need for intermediaries is
reduced.
 Disadvantages
 It offers irreversible transactions.
 Once a transaction has been included within a block on the longest chain, it
cannot be reversed. 
 It can offer very slow transaction times.
 When initiating a transaction through Bitcoin, the amount of time it takes to
complete the action can be upwards of 40 minutes.
 Cont.…
 It requires every request to be individually verified.
 Every transaction with a blockchain must be digitally signed.
 This is done through the use of private cryptography schemes to
ensure that transactions propagating between bodes can be
verified. 
 It requires a massive amount of energy.
 Running a blockchain is a very intensive form of managing resources.
 It is very capital-intensive because there are dedicated hardware
resources which must be used to be successful, especially if mining is
going to be involved.
 Massive levels of electricity are required as well, which can make
mining Bitcoins or other cryptocurrencies unprofitable, especially in
the short-term.
 Types of blockchain
 Based on the way blockchain has evolved blockchain devided into two
Public blockchains
 As the name suggests, these blockchains are open to the public and anyone
can participate as a node in the decision-making process.
 A public blockchain is an open network. Anyone can download the protocol
and read, write or participate in the network. 
 Eg. Bitcoin and Ethereum
 Private blockchains
 As the name implies are private and are open only to a consortium or group
of individuals or organizations that has decided to share the ledger among
themselves.
 Entrants to the network require permission to read, write or audit the
blockchain.
 There can be different levels of access and information can be encrypted to
protect commercial confidentiality.
 Private blockchains are faster, more efficient and more cost-effective than
public blockchains, which require a lot of time and energy to validate
transactions
 Blockchain Technology frameworks

 Ethereum
 Bitcoin
 Bigchain DB
 Hyperledger:
Features of Blockchain
 Applications of Blockchain Technology
 Asset Management: Trade Processing and Settlement
 Insurance: Claims processing
 Payments: Cross-Border Payments
 Unconventional money lenders/ hard money lending
 Smart Appliances
 Blockchain Healthcare
 Blockchain music
 Public value/ community
 Blockchain Identity
 Passports
 Birth, wedding, and death certificates
 Personal Identification
 .

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