Discuss about the Network Application Management of Blockchain.
Blockchain can be defined as digital, decentralization of various kinds of transaction related to cryptocurrency [10]. In this technology different kinds of records are added in chronological order. It helps markets participants to keep a track of transaction related to digital currency without the need of any kind of recordkeeping in a central way [3]. In it each node gets a copy of blockchain which can be downloaded automatically. Blockchain is also known as distributed ledger technology (DLT) which is being used in variety of commercial applications. At present this technology is used for verifying transactions with in digital currencies. It is also possible understanding transaction with digital currencies as much as possible.
In the coming pages of the report various aspects of blockchain like architecture, features and challenges has been discussed. After that application of blockchain in two domains like currency and internet of things has been discussed. The last part of the report focus on social technical aspects of blockchain technology.
The architecture of blockchain has list of parameter like
Block chain itself is considered to be an application which runs on network of various distributed servers [11]. The main application is considered to be a transaction database which can be achieved by sharing of all the available nodes. So it can be concluded that it is 100% decentralized transaction system.
Block chain is nothing but a network for peer to peer communication which works like IP protocol on internet [6]. A P2P is considered to be flat topology which no kind of centralized node. Implementation of blockchain consists of two kinds of records namely blocks and transaction. Transaction can be easily made by making use of mobile wallet or any other kind of client application [7]. Blocks are mainly associated with recording of sequence of transaction which mainly takes place in block chain.
Bitcoin is considered to be mother of blockchain technology [4]. There are large number of features of blockchain like increased capacity, immutability, better security and lastly settlement at much faster rate.
Increase Capacity: One of the key features of peer to peer technology is that they can easily increase the total capacity of network [5]. Folding is considered to be a good example of increasing network security by making use of various computers.
Better security: Blockchain can easily provide better security as there is no issue of failure of shut down of whole network. Blockchain are mainly secured by various computers which run nodes and provide conformation on various networks [8]. Public blockchain makes use of their own currency like incentive mechanism which can be used for securing transaction based on ledger.
Faster settlement: Traditional kind of banking services can be considered to slow and it also larger amount of time for settlement [2]. This can be considered as a vital factor behind the need of upgradation of the system. Blockchain can be considered to be best method which can be used for transferring money at much faster speed. This can ultimately save time and money for an entire organization.
Immutability: Creation of immutable ledgers can ultimately result in proposition of value for blockchain [9]. Any kind of centralized database can be corrected and generally depends on third party for keeping the information secured.
Irrespective of benefits of blockchain technology there are large number of challenges associated with blockchain like initial cost, adding up with legacy system, amount of energy consumption, perception or idea of public and lastly privacy and security.
Initial cost: Implementation of blockchain technology can easily productivity, efficiency and lastly reduction of expenditure [6]. The software which is needed for running blockchain technology is organization is developed specifically for an organization. So it can be considered to be expensive for purchasing and developing it on in-house. Along with software cost organization needs qualified person for managing this technology.
Integration with system: For moving into blockchain based system an organization must have remove the previous system or it should find a way for integrating existing system with blockchain [4]. In many cases it is seen that blockchain may be difficult for handling the function which is needed by an organization.
Consumption of Energy: Bitcoin makes use of proof of network for making transaction which are made on blockchain [7]. This whole process needs computation of mathematical problem which are complex in nature. It can be again used for verifying process and transaction for securing of network.
Perception of public: The major public makes use of existence and use of this particular technology [9]. Technology can be considered to be revolutionary in various industries but still knowledge and benefits of distributed technology is limited.
Privacy and Security: Blockchain was initially designed for providing visibility to public. Bitcoin blockchain is designed in such a way that it can provide access to large number of people who have made transaction on the network [5]. A blockchain is generally customized for needing the needs and specification of task.
A blockchain is known to be cryptocurrency which is also known as protected distributed ledger. Bitcoin is perfect example of blockchain technology. It was placed in front of public in the form of digital money [8]. It takes up consideration of its successors and competitors present in the market. Bitcoin can be considered to be traditional form of currency by which they can easily add certain number of ways which can be used for trading. But it cannot be used for playing the basic role of currency due to some medium number of exchange which can be used like a medium of exchange [11]. In bitcoin each kind of transaction takes major amount of energy and comprises of many kinds of risk.
Distributed ledgers are able to code of simple contracts which will execute when specific condition is provided. Ethereum is known to be an open source project on blockchian which was built for understanding the possibility. Ethereum comes up with potential to provide usefulness of blockchain on changing world [5]. At technology development of technology smart contract can be used for performing simple kinds of function. A certain amount of derivative will be paid when various financial instrument hits the target provided. It focuses on the use of blockchain technology and bitcoin enabling the whole process of payment to be automated in nature.
Smart contracts are considered to be complex in nature and it comes up with potential of simple transfer of assets which has the power to execute in large fields which can range from legal process to insurance premium [8]. A smart contract can easily perform similar action like crowdfunding like sharing of projects, collection of donation and setting up of goals. It mainly works with the help of third party. An individual can make use of smart contract for receiving funding until a goal has been reached.
Any kind of transaction in blockchain technology is considered to be faster and much cheaper when proceeded through it. Social impacts of block chain technology are considered to be direct. It mainly takes blockchain for running blockchain and it depends on size and way it works. In some cases, it can be quite intensive in nature also [3]. It is also said blockchain technology was high responsible for large amount of energy consumption in different regions of the world. The best effect of block chain is its contribution for changes in social values and large number of structure which are associated with it [10]. Blockchain technology is not considered to be solution to large number of problems.
Conclusion
From the above discussion it can be concluded that is report is all about Blockchain technology. In the discussion portion of the report three important aspects of blockchain technology that is architecture, features and challenges has been discussed in details. After that an analysis has been provided regarding blockchain technology in two domains that is currency and internet of things. In the last part of the report social technical aspects of blockchain technology has been discussed and analyzed. Blockchain is used in variety of application like system for recording of digital identity and tokenization. It also creates a platform for smart contracting and automated governance. The architecture of blockchain consists of various parameter like platform, nodes of blockchain, security measures has been discussed in details. Various kinds of features of blockchain technology like increasing capacity, improvised security, settlement at faster rate and lastly immutability has been discussed in the above pages of report. Different kind of challenges involved in blockchain technology like initial cost, integration with system, energy consumption, privacy and security issues has been discussed in details.
References
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