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Week 3 Assignment 2

The document discusses blockchain technology, providing details on what blockchain is, its advantages, and disadvantages. It explains that blockchain allows secure and transparent recording of transactions between parties without intermediaries. Key benefits mentioned include improved transparency, security, and efficiency through the elimination of middlemen like banks. However, issues discussed include scalability problems as the volume of transactions grows, high energy usage of some blockchains, and regulatory challenges surrounding privacy and compliance. The document concludes that while blockchain promises benefits like increased trust and cost savings, challenges around scalability, energy use, and governance must still be addressed for widespread adoption.

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46 views4 pages

Week 3 Assignment 2

The document discusses blockchain technology, providing details on what blockchain is, its advantages, and disadvantages. It explains that blockchain allows secure and transparent recording of transactions between parties without intermediaries. Key benefits mentioned include improved transparency, security, and efficiency through the elimination of middlemen like banks. However, issues discussed include scalability problems as the volume of transactions grows, high energy usage of some blockchains, and regulatory challenges surrounding privacy and compliance. The document concludes that while blockchain promises benefits like increased trust and cost savings, challenges around scalability, energy use, and governance must still be addressed for widespread adoption.

Uploaded by

Jared Money
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Jared Money

Application of Technology in a Business Setting

Dr. Jimenez

15 May 2023

Understanding Blockchain: Advantages and Disadvantages

Blockchain technology has become a ground-breaking idea with the potential to

revolutionize sectors like finance and supply chain management. This essay seeks to give a

thorough explanation of what blockchain is, as well as its benefits and drawbacks.

Blockchain is a decentralized and distributed ledger technology that makes it possible to

record transactions or digital interactions between multiple parties in a secure and transparent

manner without the use of middlemen. It works by way of a series of blocks, each of which

contains a list of transactions and a special cryptographic hash connecting it to the block before

it. Data immutability and integrity are guaranteed by this structure.

Since every user of the network has access to the same data, blockchain promotes

transparency. As a result, there is no longer a need for a central authority, and participants are

more trustworthy. Furthermore, because the information is immutable on the blockchain, it

cannot be changed or tampered with. This guarantees the accuracy of the data kept on the

blockchain.

Blockchain uses strong cryptography methods to protect data and transactions. The

technology is very hard to hack or alter without authorization because of its decentralized

structure. Consensus methods that ensure network users have reviewed and accepted

transactions, like proof-of-work or proof-of-stake, further improve security.


Blockchain eliminates the need for middlemen like banks or payment processors by

enabling peer-to-peer transactions. Through the elimination of third-party dependence, this

lowers transaction costs, quickens procedures, and boosts efficiency.

Blockchain offers a clear and verifiable transaction history. An immutable chain is

created by recording each transaction in a separate block. Due to its capacity to enable

traceability and origin verification of products, this capability is particularly beneficial in supply

chain management. It guarantees authenticity and lowers the possibility of fraud.

Scalability problems now affect blockchain technology, particularly on public

blockchains. The network may slow down and transaction costs can increase as the volume of

transactions grows. Widespread adoption in contexts with high transaction volumes is hampered

by this restriction.

Some blockchain networks need a lot of processing power and energy, especially those

that use proof-of-work consensus techniques. This has prompted questions about how blockchain

technology would affect the environment.

The regulatory environment surrounding blockchain is still developing, which makes

deployment difficult. To fully realize the potential of blockchain technology, concerns about

privacy, data protection, and compliance with current laws must be addressed.

The decentralized nature of blockchain increases the complexity of governance. For disputes,

upgrades, and protocol changes, network parties must reach consensus, which can take time and

be difficult to do.

Industry revolutions could be sparked by blockchain technology's incredible promise for

efficiency, security, and transparency. Transparency, improved security, the removal of

intermediaries, and traceability are some of the benefits that have a big impact on trust, cost
savings, and streamlined procedures. For widespread acceptance, nevertheless, issues with

scalability, energy use, governing structures, and governance must be resolved. For blockchain

solutions to be implemented successfully, it is crucial to evaluate certain use cases, determine

their viability, and weigh their trade-offs.


Works Cited

Nakamoto, S. (2008). Bitcoin: A Peer-to-Peer Electronic Cash System. Bitcoin.org. [Available

online: https://bitcoin.org/bitcoin.pdf]

Yli-Huumo, J., Ko, D., Choi, S., Park, S., & Smolander, K. (2016). Where Is Current Research

on Blockchain Technology?—A Systematic Review PLoS ONE, 11(10), e0163477

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