What is Blockchain : Types, Working, Real Life Examples, Applications

 

What is blockchain

A Blockchain collects and gathers the information in groups, known as blocks. Generally, Block can be used to hold the sets of information. Blockchain is otherwise known as Distributed Ledger Technology(DLT). The main aim of the blockchain is to allow digital information to be distributed and recorded.

Types of blockchain

  1. public Blockchain,
  2. private Blockchain,
  3. Consortium Blockchain and
  4. Hybrid Blockchain.

public Blockchain

Generally, a public blockchain is used for exchanging and mining cryptocurrency. a public blockchain is permissionless, allowing all blockchain nodes to access the blockchain.

Advantages of public blockchain

  • It is completely independent of the organization.
  • It is safe and secure.
  • The main advantage of a public blockchain is the network’s transparency.

Disadvantages of public blockchain

  • The main disadvantage of using a public blockchain is the network is very slow.
  • Public blockchain doesn’t scale at all.

Private blockchain

It is a permission blockchain and is controlled by a single organization. a private blockchain is partially decentralized because public access to the blockchain is restricted.

Advantages of the private blockchain

  • private blockchains are very fast and can process transactions more quickly.
  • It also prevents third parties from accessing certain information.

Disadvantages of private blockchain

  • It is less secure.
  • A private blockchain is more challenging to achieve trust in the information.

Consortium blockchain

It is a permission blockchain by a group of organizations. It is more secure and enjoys decentralization than the private blockchain. A popular set of consortium blockchain solutions for the financial services industry has been developed by the enterprise software firm R3.

Advantages of Consortium blockchain

  • It is more secure, scalable, and efficient than a public blockchain.
  • It also offers access controls.

Disadvantages of Consortium blockchain

  • It is less transparent than the public blockchain.
  • It can impair the functionality of the network.

Hybrid blockchain

It is controlled by a single organization required to perform certain transaction validations. The IBM Food Trust was developed to improve efficiency.

Advantages of Hybrid blockchain

  • It also protects privacy but allows for communication with third parties.
  • It is cheap and fast and offers better scalability than a public blockchain network.
  • Disadvantages of Hybrid blockchain :

Disadvantages of Hybrid blockchain

  • It is completely transparent.
  • There is no incentive for users to participate in the network.

Working procedure

 Blockchain is also known as Distributed Ledger Technology(DLT). Blockchain helps in verification and traceability. It provides secure transactions to reduce the cost and speed of data transfer processing. At first user requests for the transaction, after the request, a block representing the transaction is created. Then the block is broadcasted to all the nodes in the network, and all the nodes in the network validate the block and transaction. After validation and transaction, the block can get added to the chain. Finally, the transaction gets verified and executed.

Advantages of blockchain

  • High level of security.
  • Safe and faster transactions.
  • Transparency of transactions gets increased
  • Reduces costs.

Disadvantages of blockchain

  • Needs large energy consumption.
  • Data is immutable.
  • It is complex and inefficient.

Some Real-Life Examples of How blockchain is changing our world

In terms of Cybersecurity, there is a company called Guardtime which is changing our world very frequently using blockchain technology the company is creating a “Keyless” signature system that is used to secure the health records of more than one million citizens. and there is also another company REMME which makes decentralized authentication systems that aim to replace logins and passwords with SSL certificates stored on a blockchain.

In the Media sector, there are lots of companies which is now start using blockchain a lot to automate the media sector for example kodak. Kodak is a company that sends its stock soaring by developing a blockchain system for tracking intellectual property rights, payments of photography, etc.

In the Retail sector blockchain is also started using there is a loyyal Framework which is a blockchain-based framework its aim to allow consumers to combine trade loyalty and in rewards new ways, and retailers offer more sophisticated packages. Blockchain.io is also allowed retailers to build payment systems around blockchain currencies such as bitcoin and there is also an OpenBazaar which is an try to build a decentralized market where goods and services can be traded with no middle-man.

And there are lots of sectors where blockchain technologies are adapted for example Healthcare, Financial Services, Manufacturing, industrial, Government sectors, Charity sectors, Real estate sectors, Transport, and tourism sectors, etc.

Some Applications of blockchain

  • Money transfer.
  • Payment Processing.
  • Digital Voting.
  • Secure personal information.
  • Data Storage.
  • Financial exchanges.
  • Lending.
  • Insurance.