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Block Chain Technology

Blockchain technology is an advanced database mechanism that allows transparent information sharing within a business network using a distributed ledger. Key features include decentralization, immutability, and consensus. There are public, private, consortium, and hybrid blockchain network types. Benefits include improved security, efficiency, and faster auditing.

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BARATHRAJ D commerce
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27 views7 pages

Block Chain Technology

Blockchain technology is an advanced database mechanism that allows transparent information sharing within a business network using a distributed ledger. Key features include decentralization, immutability, and consensus. There are public, private, consortium, and hybrid blockchain network types. Benefits include improved security, efficiency, and faster auditing.

Uploaded by

BARATHRAJ D commerce
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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BLOCK CHAIN TECHNOLOGY

Blockchain technology is an advanced database


mechanism that allows transparent information sharing
within a business network. A blockchain database stores
data in blocks that are linked together in a chain. The data
is chronologically consistent because you cannot delete or
modify the chain without consensus from the network. As
a result, you can use blockchain technology to create an
unalterable or immutable ledger for tracking orders,
payments, accounts, and other transactions. The system
has built-in mechanisms that prevent unauthorized
transaction entries and create consistency in the shared
view of these transactions.
FEATURES OF BLOCK CHAIN
Decentralization
Decentralization in blockchain refers to transferring control and decision making from a
centralized entity (individual, organization, or group) to a distributed network. Decentralized
blockchain networks use transparency to reduce the need for trust among participants. These
networks also deter participants from exerting authority or control over one another in ways that
degrade the functionality of the network.

Immutability
Immutability means something cannot be changed or altered. No participant can tamper with a
transaction once someone has recorded it to the shared ledger. If a transaction record includes an error,
you must add a new transaction to reverse the mistake, and both transactions are visible to the network.

Consensus
A blockchain system establishes rules about participant consent for recording transactions.
You can record new transactions only when the majority of participants in the network give
their consent.
Key components of blockchain technology

A distributed ledger
A distributed ledger is the shared Smart contracts
database in the blockchain
network that stores the Public key cryptography
transactions, such as a shared file Companies use smart contracts to
that everyone in the team can edit. self-manage business contracts
In most shared text editors, without the need for an assisting
third party. They are programs Public key cryptography is a
anyone with editing rights can security feature to uniquely
delete the entire file. However, stored on the blockchain system
that run automatically when identify participants in the
distributed ledger technologies blockchain network. This
have strict rules about who can predetermined conditions are met.
They run if-then checks so that mechanism generates two sets of
edit and how to edit. You cannot
transactions can be completed keys for network members. One
delete entries once they have been key is a public key that is
recorded . confidently. For example, a
logistics company can have a common to everyone in the
smart contract that automatically network. The other is a private
makes payment once goods have key that is unique to every
arrived at the port. member. The private and public
keys work together to unlock the
data in the ledger.
TYPES OF BLOCKCHAIN
• Public blockchains are permissionless and allow everyone to join them. All
Public blockchain members of the blockchain have equal rights to read, edit, and validate the
blockchain. People primarily use public blockchains to exchange and mine
networks cryptocurrencies like Bitcoin, Ethereum, and Litecoin.

• A group of organizations governs consortium blockchain networks. Preselected organizations


Consortium share the responsibility of maintain ing the blockchain and determining data access rights.
Industries in which many organizations have common goals and benefit fro m shared
responsibility often prefer consortium b lockchain networks. For examp le, the Global Shipping
blockchain networks Business Network Consortium is a not-for-pro fit blockchain consortium that aims to digitize the
shipping industry and increase collaboration between maritime industry operators .

• A single organization controls private blockchains, also called managed


Private blockchain blockchains. The authority determines who can be a member and what rights they
have in the network. Private blockchains are only partially decentralized because
network they have access restrictions. Ripple, a digital currency exchange network for
businesses, is an example of a private blockchain.

•Hybrid blockchains combine elements from both private and public networks. Companies can
Hybrid blockchain set up private, permission-based systems alongside a public system. In this way, they control
access to specific data stored in the blockchain while keeping the rest of the data public. They
use smart contracts to allow public members to check if private transactions have been
networks completed. For example, hybrid blockchains can grant public access to digital currency while
keeping bank-owned currency private.
BENEFITS OF BLOCKCHAIN
TECHNOLOGY
Improved efficiency Faster auditing
Advanced security

• Blockchain systems provide • Business-to-business • Enterprises must be able to


the high level of security and transactions can take a lot of securely generate, exchange,
trust that modern digital time and create operational archive, and reconstruct e-
transactions require. There is bottlenecks, especially when transactions in an auditable
always a fear that someone compliance and third-party manner. Blockchain records
will manipulate underlying regulatory bodies are are chronologically
software to generate fake involved. Transparency and immutable, which means that
money for themselves. But smart contracts in blockchain all records are always ordered
blockchain uses the three make such business by time. This data
principles of cryptography, transactions faster and more transparency makes audit
decentralization, and efficient. processing much faster.
consensus to create a highly
secure underlying software
system that is nearly
impossible to tamper with.
There is no single point of
failure, and a single user
cannot change the transaction
records.

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