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
- public Blockchain,
- private Blockchain,
- Consortium Blockchain and
- 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.
- Increased transparency of transactions.
- 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
A company called Guardtime is continually changing our world by using blockchain technology to create a “Keyless” signature system that secures the health records of over 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.
Retail has also begun using blockchain technology there is a loyalty framework that uses blockchain technology to combine trade loyalty and rewards in new ways, and retailers are offering more sophisticated packages. Also, Blockchain.io provides retailers with the ability to build payment systems around blockchain currencies such as bitcoin, and there’s OpenBazaar for trading goods and services without a middleman.
Healthcare, Financial Services, Manufacturing, Industrial, Government, Charity, Real Estate, Transport, and Tourism are just a few sectors that adopt blockchain technology.
Some Applications of blockchain
- Money transfer.
- Payment Processing.
- Digital Voting.
- Secure personal information.
- Data Storage.
- Financial exchanges.
- Lending.
- Insurance.