Blockchain Technology and Applications | The famous Ethereum
This term can be rendered in many ways. Among them are the concepts of blockchain, notification chain or distributed ledger/array. In general as a term it is difficult to explain concisely or understand it as easily. What is certain, however, is that it’s a technology that will radically change the way the economy, businesses and other aspects of modern society are organized. It is one of the fastest growing technology trends of the future, along with Augmented Reality and Artificial Intelligence. One of the most widely used blockchains is Ethereum, a brief presentation of which will follow bellow.
On the creator of the Blockchain Technology
Satoshi Nakamoto
Satoshi Nakamoto is credited as the creator of this technology and not just for the first cryptocurrency, the Bitcoin. In 2009, in addition to mining the first block of 50 Bitcoins, he also released the source code of the Blockchain on SourceForge. His goal was for developers around the world to contribute to the development of this radical technology.
In fact, it is probably a pseudonym whose paternity has been claimed by many. Very little is known about it. Hence, the mystery still surrounding its identity.
David Chaum
It was then that the Japanese man posted his research paper on the discussion forums. It was titled “Bitcoin: A Peer-to-Peer Electronic Cash System”. However, the protocol of this technology was the same as David Chaum’s two decades earlier. At least a decade before Nakamoto’s white paper was published in 1982, he described it in a paper entitled “Computer Systems Established, Maintained, and Trusted by Mutually Suspicious Groups”.
Chaum had even founded a company, in 1989, called DigiCash. A few years later he also introduced a digital currency, digicash (aka eCash or cyberbucks). Promising complete anonymity and inability of even governments to trace transactions, he was unable to convince banks to back him financially. His company went bankrupt in 1998. His goal was to support peer-to-peer transactions without an internet infrastructure.
Would history repeat itself? Bitcoin looked at first like it would suffer the same fate as DigiCash. One principal characteristic is considerable volatility, but in recent years it has been trending strongly upwards expanding its applications. Ethereum now is its notable competitor.
On the structure of Blockchain
We can start by looking at Blockchain as a decentralized database with built-in encryption. It is not stored on one central server where all users can access it, but on computers around the world. Its architecture is “distributed”, otherwise known as “peer-to-peer“. It is a public digital ledger and includes all transactions/communications. The full history is displayed, without the possibility of editing past data. The data series are grouped chronologically into blocks and numbered segments.
These blocks are encrypted with the SHA-256 (hash algorithm), which fragments the information so that it cannot be reversed. The result is always fixed, whether the data is one character or an entire book. Each block in the chain, in addition to the working proof (a unique number as a digital signature), has the code of the previous block. The nodes are updated with the last ever copy of the block.
Fragmentation
In order not to be vulnerable the chain at all its individual points has been encrypted. Thus, hackers would not be able to change the data of neither previous nor subsequent leaves. Instead of simply adding data, the process of hashing is used.
This creates an identifier unique to each entry value by combining the previous entry and the current one just entered into a one-way sequence. Thus, from the applications you cannot go back and change the older data, nor can you delete it. This means of course that if you were sending a dollar amount in Bitcoin to yourself, for example, you wouldn’t be able to delete the transaction.
The hash value, which has many digits, is based on that of the immediately preceding block. It can never take the value 0, as only Nakamoto’s block had it, as the first one created.
Encryption
Interference by a hacker is therefore unlikely, due to the architecture of the database. In this peer-to-peer database, the malicious party would have to simultaneously change database copies on thousands of computers around the world.
With the encryption, the following is ensured. Yes, the data is visible to every user, but it can only be decrypted and formatted by those with keys. Without the key, one would simply see a stream of characters that would make absolutely no sense.
The received data is thus secure, private, but also verifiable at all times. At the same time, the file itself is public for anyone to see. It could not be decrypted, however, to read the contents of the blocks.
Dynamics of Blockchain Technology
As is easy to understand, this process is slow and takes up a lot of computing resources. Chains perform well only with lightweight load and processing times can extend to days. At a given time the system can process less than 10 transactions per second. Credit card companies currently process 2,000 such transactions (TPS, transactions per second). One of the chains with the strongest processing power is Ethereum.
Up to 30 transactions per second can be processed on the Ethereum chain, the most widely used blockchain. The platform is used for other applications besides virtual money. Its specification, ERC-721, defines the protocol of NFTs (Non-Fungible Tokens). Many businesses are now implementing token-based economies.
Generally many new blockchain applications are not even related to cryptocurrencies. Even if these were to go out of legal operation, blockchains would still be useful for other functions. These include the management of a logistics unit, in identity management, in the health or even entertainment sectors.
Blockchain Technology and the public government sector
This technology is here to stay. It is important to understand its applications and the positive impact it could have even in the public sector. There are many areas of application. For this reason, the discussion must move away from its simple association with Bitcoin, which is still viewed with suspicion by the general public due to semi-literacy around the matter.
Bellow will follow, in a completely brief manner, some of the areas in which it can be used. In summary, citizens could have a more direct and efficient service from the point of view of public services for the filing of supporting documents or keeping a centralized record, for example. Let us not forget that all chains are visible to users. In this way, we will also be able to talk about full transparency of procedures, even of government expenditure.
The applications include:
– Identity
Easy process of creating citizen ID cards, as well as birth certificates, death certificates, etc.
– Personal records
These are organized records inter-textually where documents necessary for health, insurance will be kept with equally easy access and time visibility.
– Transactions with organisations
The handling of transactions are automated and the provision/exchange of information is handled with great ease.
– Benefits, government assistance
Social security, state aid, medical benefits
– Contracts and supply chains
Management of purchase commitments, vendor payments, program monitoring.
– Elections/Polls
New digital voting methods, verification of eligibility to vote, vote counting and process control.
Learn more on Blockchain Technology by following the link, https://www.blockchain.com/ .
To continue reading on Ethereum and Blockchain in general, find more stories on this topic here or here.
Author: PC-GR
The World of Technology
