Monday, December 3, 2018

What is blockchain? Everything you need to know

What is blockchain?

Like much of the technology world, cryptocurrencies such as Bitcoin still rely on some form of database that are able to track large volumes of transactions and keep them secure. The solution used by many of the world’s largest digital currencies is the blockchain. 

First implemented in 2009, the technology consists of 'blocks' that hold batches of timestamped transactions, with each block linked to the previous one through cryptography, thus forming a chain.

As the world becomes ever more smarter and inter-connected, cryptocurrencies have become an increasingly attractive proposition for growing markets that may not have traditional banking infrastructure. Several developing third-world nations have implemented blockchain-based national currencies, and the technology is also used by several major charity projects to help those without bank accounts.

However blockchain also offers the possibility of creating a fraud-proof system for transacting exchanges. This therefore gives it huge potential for use outside of the digital currency sphere, helping attract interest not just among traditional financial institutions, but in areas as diverse as manufacturing, food production and many more.

Blockchain - the latest news

30/11 - Huawei rolls out global blockchain - Cloud-based blockchain service is available worldwide...

29/11 - Amazon reveals its own blockchain platform - E-commerce giant announces managed ledger database and managed blockchain service...

26/10 - Royal Mint shutters plans for gold-based blockchain - RMG tokens will not be launching at this time...

24/10 - Accenture wants to tie blockchains together - New service can connect two or more blockchains together in attempt to solve interoperability problems...

23/10 - HTC Exodus blockchain smartphone launches today - Blockchain-powered Exodus 1 device is available from today for cryptocurrency fans...

18/10 - Blockchain can “revolutionise” UK business - Capgemini study highlights benefits blockchain can bring to supply chains around the world...

10/10 - Ofcom investigates how Blockchain can be used to distribute phone numbers - Ofcom hopes to create a more efficient database for the UK...

10/10 - A look at the vital role blockchain is playing in banking the unbanked - Blockchain is helping to bring inclusive finance to the world's deprived communities...

09/10 - How blockchain will herald a new era of security for your business operations - Will blockchain play a pivotal role in the future of Internet security?

09/10 - Lack of collaboration hindering European blockchain adoption - European businesses see the potential of blockchain but are unwilling to collaborate...

28/09 - Blockchain breakthroughs – just how much can the tech do? - We take a look at some of the most interesting blockchain use cases around today...

20/09 - The impact of blockchain - Which industries are set to benefit the most from this emerging technology?

20/09 - HTC Exodus: The blockchain phone that could change the internet as we know it - We speak to HTC's Phil Chen about why its blockchain phone could be a new dawn for the internet...

10/09 - Understanding the power of Blockchain infused with AI - What could the marriage of AI and blockchain produce?

14/08 - Half of Brits say they don't trust blockchain - Many Brits say they are baffled by blockchain, and wouldn't trust companies that use it...

09/08 - Blockchain is not the answer to your security troubles, Google boss says - Project Zero chief also calls for more collaboration in security industry...

06/08 - Blockchain and IP: building the blocks to a better future - Why blockchain could be the key to transform the IP industry...

30/07 - IBM bets big on blockchain app store - LedgerConnect system set to push blockchain services further than before...

25/07 - Blockchain company Tron buys BitTorrent - File sharers can rest easy...

24/07 - Google bets on blockchain for cloud - Google Cloud Platform now supports key backbone of blockchain technology...

18/07 - Mastercard targets major blockchain breakthrough - Card provider looks to patent technology aimed at making blockchain payments simpler and faster...

12/07 - Finney is the world's first $1,000 blockchain phone - Blockchain-powered Finney phone revealed by Sirin Labs ahead of launch...

11/07 - HTC Exodus: everything you need to know about the blockchain phone - HTC is launching a blockchain-powered phone, here's all the top facts...

10/07 - HTC reveals more on its blockchain phone - HTC Exodus will get early access later this year...

04/07 - MP calls for UK government to get behind blockchain - Eddie Hughes MP urges government to appoint Chief Blockchain Officer to gain support...

25/06 - Microsoft is re-launching its blockchain - Teaming up with banking giant EY to make blockchain a force for good...

18/06 - What is Hdac? The World Cup blockchain advert, decoded - We take a closer look at the World Cup’s most technology-friendly advert...

11/06 - UK could be set for first blockchain listing - London Stock Exchange listing could be a UK blockchain first

06/06 - The role of blockchain in GDPR compliance - Can blockchain be the key to helping your business conquer GDPR?

31/05 - GDPR compliance and Blockchain - How are two of the biggest technology issues of today linked?

29/05 - Blockchain could revolutionise retail: Deloitte - Deloitte report claims major changes could be made using blockchain...

23/05 - American Express: Why blockchain could save help save you from fraud - American Express technology head hints at more blockchain to come from the card provider...

16/05 - HTC is making a blockchain smartphone - HTC Exodus will feature beefed-up security protection designed for blockchain transactions...

14/05 - HSBC marks major blockchain landmark - World-first transaction using blockchain marks a crucial step forward... 

09/05 - Facebook launches new blockchain team - Blockchain team will be led by former Facebook Messenger head David Marcus...

08/05 - Report urges caution on the benefits of blockchain - Vast majority of companies reportedly still have no strategy when it comes to blockchain...

15/03 - Blockchain can 'speed up' payment settlement between telcos - Colt and PCCW hold trial of Blockchain for wholesale voice call payments...

06/02 - The best Bitcoin exchange of 2018 - It’s all about reputation, currency support and transaction fees...

27/01 - Here are 5 markets that blockchain will transform beyond recognition - From credit cards to loyalty schemes...

18/01 - 7 ways blockchain will change the legal industry forever - From smart contracts to the chain of custody...

17/01 - 6 things that prevent Blockchain from ruling the world - From energy wastage issues to worries about bulkiness...

16/01 - Here are the 10 sectors that blockchain will disrupt forever - From the obvious like banking, to the not-so-obvious…

26/08/2017 - Microsoft is making a blockchain that’s fit for business - Coco Framework aims to remove persistent stumbling blocks...

How does Blockchain work?

A blockchain system consists of two types of record, transactions and blocks. Transactions are simply the actions carried out in a particular period, these are stored together in a block.

What makes blockchain more unique is that each block contains the cryptographic hash of the previous one, thus forming a chain. What a cryptographic hash does is take the data from the previous block and transform it into a compact string. Since these strings are impossible to predict it means that any tampering with the chain is easily detected. 

This method means that blocks don’t need to have serial numbers, the hash allows them to be uniquely identified as well as verifying their integrity. Each block confirms the validity of the previous one right back to the so called ‘genesis block’ at the start of the chain.

The linking of blocks isn’t the only thing that keeps the chain secure, however. It’s also decentralised, each computer with the software installed has a copy of the blockchain which is constantly updated with new blocks. There is no centralised server holding the transactions and because each new block must meet the requirements of the chain nobody is able to overwrite previous transactions.

Other transaction requirements can be added to define what constitutes a valid entry. In Bitcoin for example a valid transaction has to be digitally signed, it has to spend one or more unspent outputs of previous transactions, and the sum of transaction outputs cannot exceed the sum of input.

What are some of the biggest blockchain databases?

Blockchain has exploded in popularity over the last few years, gaining backers throughout the technology and financial sectors.

Away from Bitcoin, which remains the most well-known and arguably most widely-used network, this has led to a number of alternative blockchains coming to the fore in recent times.

This includes R3, which is developing blockchain-esque technology that can be used by major banking institutions, and in May 2017 raised $107 million in funding from backers such as Intel, HSBC and Bank of America. 

Another major player is Hyperledger, an open-source cross-industry collaboration created by the Linux Foundation in order to popularise blockchain-based ledgers, with the first generation of its technology released in July 2017.

All the so-called ‘big four’ accounting firms have also said they are testing blockchain technologies, although so far only Ernst and Young have gone public with their technology, making a digital wallet available to all its Swiss employees.

IBM announced in March 2017 that it will be building its own ‘blockchain as a service’ offering based on Hyperledger, which will allow customers to build secure blockchain networks.

Earlier this year, the London Stock Exchange also revealed it was is set to start using blockchain to improve transparency for shareholding information among unlisted businesses, showing the impact the technology has had. 

How secure is blockchain?

Due to its advanced cryptographic protection systems, in theory, blockchain offers a far more secure experience than traditional banking.

The fact that the technology is decentralised, and cannot be retroactively altered or edited makes it ideal for financial transactions and the storing of important information.

Blockchain also benefits from being able to preserve the privacy of the user - however this has unfortunately made it increasingly popular as the payment method of choice for cyber criminals, as a Bitcoin network node doesn’t have to reveal the identity of the person making or receiving payments.



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