Block Chain & Distributed Ledgers

Blockchain is a distributed, decentralized, public ledger. A distributed ledger is merely a type of database spread across multiple sites, regions, or participants. It is a consensus of replicated, shared, and synchronized digital data. Learn more about how the blockchain system is going to change the way you transact business

Introduction

Blockchain leverages Cryptography and hash pointers to create a continuously growing list of records, which are linked to previous blocks, secured using cryptography, contains a hash pointer that establishes links to previous blocks, contain a timestamp and some data.

The use of hash pointers combined with cryptography enables blockchains to become inherently resistant to modification of the data. Sharing blockchain data serves as an open distributed ledger that can record transactions between two parties in a verifiable and permanent way. Any alteration needs a collusion of the network majority.

It’s important to note that for the blockchain to work, the node-to-node network must be motivated and agree to work under ethical standards. Once, and only if, these standards are adhered to, the blockchain could become a powerful tool for improving business, conducting fair trade, democratizing the global economy, and helping support more open and fair societies.

Application of Technology

As Blockchains are secure by design they find a lot of applications for the recording of transactional data, events, medical records, record management activities, and documenting provenance as potential uses. Bitcoin the first digital currency, uses blockchain to maintain its transactions and for solving the double-spending problem without the use of a trusted authority or central server. Blockchain provides transparency, security, and standardization without the use of a central intermediary.

Business Case Example

Venture investment exceeding $1 billion was made in 2015 alone on blockchain technology. The economic and social impact of blockchain’s potential to fundamentally change the way markets and governments work is only now emerging. This revolutionary decentralized blockchain system is going to change one’s life from the way one transacts business or manage assets, to the way one use your machines, vote, rent a car, and even prove the identity. It will have applications in banks and other financial institutions, hospitals, companies, and governments among others.

Financial Services: In traditional financial transactions intermediaries like Banks are often needed to mediate the process and resolve conflicts when a financial transaction takes place between two parties. Blockchain can be used to make the process more transparent, and more effective by introducing products like smart bonds and smart contracts. The former automatically pays bondholders their coupons once certain preprogrammed terms are met. The latter are digital contracts that self-execute and self-maintain, again when terms are met.

Insurance: Claims processing can be a frustrating procedure as insurance processors should validate and approve in midst of fraudulent claims, fragmented data sources, or abandoned policies. The blockchain provides a transparent system by using its encryption properties that allow insurers to capture the ownership of assets to be insured.