Global Blockchain Platforms

A blockchain is a public ledger using the underlying infrastructure of the Internet that chronologically records and stores the history of every action ever recorded on a specific network. Information and transactions are bundled into blocks and posted to the chain as they are generated. The blockchain is maintained by nodes, or interconnected computers on the network.  These nodes and interconnected computers execute algorithms to form a block. Once a block is formed and validated by the nodes and computers, it is posted on the blockchain. The stored data is encrypted.

When individuals transact business over the internet using a blockchain, they need a private key and a public key. The public key is used to send and receive payments. The private key secures the payment. When both are present, proof of ownership and digital identity is established.

A blockchain uses the entire network to ensure the validity of a single block. Instead of a central authority, the blockchain requires a majority of the nodes to reach a consensus and validate through math that something has occurred. Different consensus mechanisms exist, but the most common one is called proof-of-work. Once a block has been added to the blockchain, it becomes an immutable record.

Blockchain has been called the ‘next Internet’, or the Internet of Value. There are many different blockchains including public, private, and consortium blockchains.

Public Blockchain

A public blockchain allows anyone to join and become a node. All transactions are publicly available and the value of the transaction is public. On a public block, the wallet ID is visible as opposed to the name or ID of the person or entity that controls the wallet.

Private Blockchain

A private blockchain has identified participants. It is different from a public blockchain as it controls who is allowed to participate in the network, execute the consensus protocol, and maintain the ledger. 

Consortium Blockchains

A consortium blockchain has predefined rules, roles, and consensus mechanisms. In a consortium blockchain, a few selected nodes are predetermined. In contrast to a public blockchain, it does not enable everyone connected to the internet to participate in the verification of the transaction. In contrast to a private blockchain, it does not enable a single company to have full control.

Blockchain technology provides a number of advantages over existing methods of providing and accessing services. These advantages include, but are not limited to, enhanced security, greater auditability, reducing costs for users through automation of workflows, and improved privacy, among others.

Blockchain is becoming increasingly used by corporations, private institutions, small businesses, partnerships, and others. All are beginning to leverage the power of blockchain to secure, streamline, structure, better processes, and enforce agreements. Applications are useful in a number of industries. Payments and transactions can be facilitated via blockchain-based processors in a cheaper, quicker, and more flexible way. Data storage systems with encrypted public ledgers can be created through blockchain verifying authenticity and ensuring transparency. Smart contracts can be used to automatize and streamline payments and other transactions making the process more transparent and irrefutable, in effect. Instances of fraud are easier to detect as the blockchain would reject multiple claims allocated to the same insurance case. Supply chain management can be improved, increasing transparency and validity.

Cryptocurrency is a digital token designed to work as medium of exchange that uses cryptography for security. Cryptography makes the system very secure. Decentralized in nature, cryptocurrency typically works through blockchain, a distributed ledger technology that serves as a public financial transaction database. The first blockchain, and cryptocurrency, was Bitcoin. Bitcoin has been a catalyst for an entire market of cryptocurrencies which has grown significantly. Since the release of Bitcoin, over 4,000 altcoins (cryptocurrency that is not a Bitcoin) have been created.

Bitcoin is a digital currency, that runs on blockchain technology. Unlike prior payment systems, bitcoin is not controlled by any government. This is unique in the world of finance. The Bitcoin blockchain is maintained and secured by a community of users called “nodes”. Bitcoin is a peer-to-peer network, there is no need for a third party to facilitate transactions between a buyer and seller. Since no central authority is responsible for bitcoin, it cannot be debased, controlled or used as a political tool. Once transactions occur, they’re final and create a secure record of each user’s actions on a network. These actions are permanent on the blockchain. Each user is given a digital identity when they log onto the network. A public key and private key create the digital identity. A user’s public address is what is used to send and receive coins. The user’s private key is specific to the user and should not be shared. Bitcoin is the first and currently most dominant cryptocurrency with a hard cap of 21 million bitcoin.

Ethereum is a distributed public blockchain network. On the Ethereum Network, servers and clouds are replaced by nodes, or interconnected computers, that are run by users around the world forming, what is in essence, a global computer. Ethereum is a platform for sharing information across the globe and cannot be manipulated or changed. Without a central server, there is no main authority to change or shut down these programs without the entire community knowing. Each and every one of these nodes store and validate all of the transactions and info that are processed on the network. Ethereum’s goal is to use blockchain to replace internet third parties — those that store data and keep track of complex financial instruments. The possibilities of applications that can be built on top of Ethereum are vast. Ethereum expands on bitcoin by harnessing blockchain capability for computer code. As the Ethereum network grows it will change the way business is transacted on a daily basis.