- In the 21st century, we have seen technology becoming an integral part of our lives in every domain from communication to defense, from learning skills to business investments. When we think about technology first thing that comes to our minds is computers. In today’s times, computer technology has reached its new limits in web 3 development which can open a gateway to becoming more techno-savvy and having a better view of the development of the world.
What Is Blockchain?
- Blockchain is referred to growing data of the records that are to be stored in the format called blocks. These linked data in the blocks are stored with the help of cryptography. In simple words, it can be said that a blockchain is a peer-to-peer network that stores the public ledger of any one type of cryptocurrency, data stored in it cannot be changed because of its design. In the year 2008 Satoshi Nakamoto and a bunch of his friends are said to be the founder of the first blockchain ever. They created it to make it serve as a public ledger for BITCOIN cryptocurrency which we know right now as the biggest crypto network in the world. The identity of Satoshi Nakamoto is still unknown. In the year 2011 blockchain got launched legally. The work done by the makers of bitcoin was inspired by the ideas of scientists Stuart Haber and W. Scott who gave the first-ever definition of blockchain in 1991.
Why Has Blockchain Become So Popular In Recent Times?
- In recent times which is after 2018, we have seen the whole world has shown a great interest in blockchains and cryptocurrencies and they saw a great opportunity in it to gain money from it as its fluctuation in valuations price is very high. Some people took it as an alternative for investments rather than investing in stocks because of the high risk and low returns from the stock market in these times. But, on the other hand, if we hear from some of the world’s biggest stock investors told that it is not actually investing your money to gain returns but act as a gambling market because you know that fluctuations can even make its value negative in just a matter of seconds. After listening to all of these pros and cons of it we have seen people between the age of 18 to 35 eagerly working on understanding algorithms of different blockchains and also understanding their progressions as we do in the stock market to get better results.
How Did Blockchain Technology Come Into Existence?
- Cryptographer David Chaum in the year 1982 gave the basic outline for storing data in the form of blocks, and this was further explained in a clear manner by Stuart Haber and W. Scott where the main aim was to create a way to store the ledger in a public domain in a time bounded manner which cannot be tampered. With these ideas, they keep on working on blockchains to improve their efficiencies with the requirement of less maintenance. A decade later in the year 2008 first blockchain was founded named bitcoin. And after that since the year 2010 till now we now have more than 1000 blockchains working in the world.
Influence Of Blockchain In The Indian Context
- India is a country with a wide variety of people and most of the population is youth. So, which makes our country most suitable for experimenting with new technologies and giving some extraordinary solutions to the problems which are faced daily by all of us. Blockchains’ best use in creating public ledgers can help us a lot as it would provide a faster way to access the memory which can be proved beneficial in terms of volatile investing places like the share market or in the crypto market as well which has now been legalized by the Indian government. Some of the biggest investors across the country said that the crypto market is not at all a way to earn money, but it has been seen in recent times with small investments in different types of cryptocurrencies can be beneficial in gaining some profits which excites the youth very much.
Types Of Blockchains
There are 4 different types of blockchains:
- Public blockchains
- private blockchains
- Hybrid blockchains
- Consortium blockchains
1. Public Blockchains
Public blockchains as their name suggest it is open to the public means a person who has internet, and a computer can have access to these blockchains that are not owned by anyone, and they grow with the increased number of interactions with new devices. Public blockchains help in the verification of transactions and records.
Public blockchains are widely trusted by people as the data stored in them is with algorithms that can detect fraud also these blockchains are of very large size which makes the data stored at various locations so the security of the data gets enhanced. Data is always stored with an anonymous identity so the personal details of everyone are secured. But, if there are pros, there are some cons also Transaction in such types of blockchains is very slow because of their large size and it also requires a good quality setup to work on them. These public blockchains are decentralized which means there is no central authority over them, so this is the reason it is becoming difficult for our government to implement them.
2. Private Blockchain
These types of blockchains are not decentralized like the public blockchains and only some of the nodes were open for participating in the process. These types of blockchains are more secure than the public blockchain. Private blockchains are open for only some authorized people and only some of them can access them. All of these work in a closed network these types of blockchains are more successful for the organization or companies as they can be more controllable by a central entity of the company.
One of the biggest advantages of these types of blockchains is that it works faster for transactions than the public cause their size is small, and a smaller number of nodes are open, its size can be changed at the manual level so that its applications increase with different sizes. The level of confidentiality that is provided for the transactions in the public blockchain increases a lot and it is more balanced as only some users have access to the transactions which improves the performance of the network.
In some rare situations these blockchains become vulnerable to cyber-attacks because only certain nodes are open which increases the chances of manipulation. This type of blockchain is more centralized which means it can be controlled in a better manner which on the other hand can make organizations can use this for malpractices. As it is connected to only a few systems so if these systems could go offline then the data of the whole blockchain become endangered.
One of the best applications of private blockchains makes the data of the people more secure and confidential to the public domain. Companies use these blockchains for internal auditing, voting, asset management, and understanding the ideas of increasing productivity. The biggest private blockchain that existed and have been the biggest in saving ledger transactions are Hyperledger and Corda.
3. Hybrid Blockchain
It is a mixture of both the previously discussed blockchains, some part of them is developed or controlled by organizations and some of the parts are left open-ended and used for transactions worldwide. In a hybrid, blockchains users intervene and access the information with the processing of the smart contracts. Permission-based and permissionless systems both are used for this type of blockchain.
Permission-based systems are those which require an acknowledgment from the organization which owns that blockchain. A Permissionless system is which does not require any permissions to access the information of a transaction but requires permission to make changes to it. It is the best type of blockchain to work with as we have the benefit for everyone to access the information but secured at the same time as almost 50 percent of the users can not make changes. The computational cost of funding the transaction is very low as only a few of the nodes are involved in verifying the transaction. It is also considered a very useful form of the blockchain as it can choose the participants which can join the blockchain and which transactions can become public. When we see the other side of hybrid blockchains it shows that it is of very low efficiency, and everyone cannot afford the maintenance of it. It is of best use in the healthcare industry, government, real estate, and financial companies. In the future, we can also use it to store and share information about government schemes as it will be centralized, and the data can be seen by the local public. One of the best examples of hybrid blockchains is ripple network and XRP tokens.
4. Consortium Blockchain
- The consortium is somewhat like a hybrid blockchain. It is also known as the federated blockchain. It is an innovative way to create a blockchain to give an innovative method to solve the needs of organizations. As it is a very new and relatively fast way to work in blockchains the number of users of these blockchains is less so the working of it is fast. Due to this high speed, this becomes very efficient and gives speed which is a key to any business. Multiple organizations can work together to form the database from various organizations and they all make it decentralized at every level. There is much divergence in the flexibility of the blockchain. Since it is not a big decision-making process so it can take decisions faster. Consortium blockchains are right now the highly feasible type of blockchains available as it is used by mainstream start-ups in boosting up their customer experience for tracking the stuff that will be delivered by them and keeping the record of these transactions that are happening on their applications.
Applications Of Blockchains
Cryptocurrencies- One of the biggest applications of blockchains right now is cryptocurrency. As crypto basically works on the idea of the ledger of transactions and blockchains can keep a record of it both in a private and public environment.
Cars- blockchain can also be used in developing these next-generation cars which are filled with the latest technologies which can make our drive safer and fuel efficient. In cars, we have often listened to the people damaging the odometer readings of the cars to make the second-hand cars look first-hand. After seeing the ideas used by the government in solving these problems were not able to work in a proper manner to solve these frauds. blockchains can become a perfect solution and have also been seen in the big car companies which have connected the cars to the internet while it is in motion and keep the odometer readings stored in the blockchains from where they cannot be removed.
Documents – blockchains are the best way to keep records. It can be the best tool that can be used by our government to keep records. We can see that India is the world’s largest population so to keep the information regarding the ADHAAR information of the citizen or such kind of big databases can be easily stored on the blockchains. But there must be some improvements will be required so that the information must be stored in privacy so that right to privacy must be protected.
Voting- yes voting can also be done with the help of blockchains. As we know that voting in India is now done on EVM (electronic voting machine), but we have also seen various cases in the past few years that hacking of EVM was seen as people have become more techno-savvy and using their expertise in technology in foul play which can be a threat to the greatest democracy of the world. When we see the basic working of blockchain so we can see it can help us in building machines that can help in making the electoral process much more secure.
Supply chains – India is a country of growing start-ups so the supply chains in the working of a start-up are very important and can be developed in a perfect manner with the help of blockchains. If we take the examples of food industries where food quality control certification is very important. Blockchain can help in the best way to get the certificate.
Real estate – blockchains can also be used to use the title registry system for property transfer.
NFTs – NFT stands for Nonfungible tokens which have also been in trend as a mode of investing till the time crypto became famous and NFTs transferred, and their market also grow in the best way with the help of blockchains.
Apart from all these applications there are also numerous applications that are going around in the world about blockchain, and it can be beneficial for good governance in a densely populated nation, but it will require improvement in its structuring which can be done so that only specified organizations can access it.
Top 13 Amazing Facts About Blockchain Technology
Bitcoin which is considered the pioneer of cryptocurrency and the first ever application of blockchains currently has 8 million users having a database on it and it is growing 100 percent every year.
Blockchain technology is developed to the extent that the internet was about 20 years back.
Till now blockchain technology is used by 0.5 percent of the world’s population.
The world’s 2 biggest multi-national companies which invest extensively in blockchain technology are IBM and Microsoft.
To date, IBM has invested almost 200 million dollars and taken a staff of 1000 personnel for blockchain projects.
In the last five years, Venture capitalists have invested over 1 billion dollars in start-ups related to blockchain development.
The blockchain market is expected to grow to a valuation of 20 billion dollars by 2024.
Most of European and North American banks are now exploring blockchain solutions for data storage.
A blockchain can be the easiest database that can transfer information to the whole world.
Blockchain technology in the near future can revolutionize the whole banking sector with which banks can save about 8 – 12 billion dollars annually.
33 percent of the C- level executives have now agreed to shift the working on blockchain technology.
The negative aspect of the blockchain, it has been often said that some of the jobs will become obsolete, but it will also open different aspects and job opportunities.
Many of the technical institutes in the country have now introduced courses or subjects about blockchain development in their curriculum.