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Blockchain Technology - IFSM 495 6381 Trends and Practical Applications in Information Systems Management (2208) Blockchain is a special type of database that stores records or blocks in databases known as chain. It is based on network topology, where data can be stored on several different servers, allowing everyone on the network to access inputs in near real-time. This makes it difficult for a user to gain control of the network or manipulate the data. The decentralized and distributed data systems characteristic allows blockchain to store digital transactions without the use of a central point of authority.
Blockchain is a new technology, the following is a brief timeline of some of the most recent and notable developments in the history of this fascinating technology:
1. 1991: A cryptographically secured chain of blocks is described for the first time by Stuart Haber and W Scott Stornetta (Mearian, 2019).
2. 1998: Computer scientist Nick Szabo works on ‘bit gold’, a decentralized digital currency
3. 2000: Stefan Konst publishes his theory of cryptographic secured chains, plus ideas for implementation.
4. 2008: Developer(s) working under the pseudonym Satoshi Nakamoto released a white paper establishing the model for a blockchain.
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5. 2009: Nakamoto implements the first blockchain as the public ledger for transactions made using bitcoin.
6. 2014: Blockchain technology is separated from the currency and its potential for other financial, inter-organizational transactions are explored. Blockchain 2.0 is born, referring to applications beyond currency (ICAEW, 2020).
7. 2015: NASDAQ and San-Francisco blockchain company Chain team up to test the technology for trading shares in private companies.
8. 2016: Tech giant IBM announces a blockchain strategy for cloud- based business solutions.
9. 2018: IBM develops a blockchain-based banking platform with large banks Citibank and Barclays signing on.
10. 2019: The Ethereum blockchain system introduces computer programs into the blocks, representing financial instruments such as bonds.
Blockchain has grown remarkably in the last few years, and based on its various characteristics, we can categorize it into several forms such as Public Blockchains and Private Blockchains.
Blockchain technology is commonly associated with cryptocurrencies such as Bitcoin. Having a database of transactions that is distributed, checked, and managed by a network of computers around the world. Instead of a single central authority, such as a bank, the records are overseen by a wide group, and no person has power over them, and no one can go back and alter or delete the history of transactions. In other words, when a standard centralized database is located on an individual server, blockchain is distributed to the users of the app. Blockchain enables everyone on the network to access the entries of
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anyone else, making it difficult for a centralized organization to take control of the network. Whenever anyone makes a transaction, they go to the network and the computer algorithms determine the validity of the transaction. If the transaction has been checked, this new transaction is connected to the previous transaction creating a chain of transactions.
Advantages of Blockchain a. One of the main benefits of Blockchain is Dissemination, which enables a database to be exchanged without a central body or agency. Owing to the decentralized design of the blockchain, it is almost difficult to temper the data compared to the traditional database. b. Users are allowed to monitor their details and transactions. c. Blockchains have complete, consistent, and up-to- date data without accuracy.
Blockchain is a ground-breaking concept as it has been able to provide users with transparency and has been a game-changer for many industries. Blockchain encourages entrepreneurship by eliminating oppression and breaking down the walls of bureaucracy and creating power over the masses of people. This peer-to-peer technology has opened the door to new opportunities and has built a personal framework for economic empowerment. The future of blockchain seems interesting, and it is evident that blockchain technology is here to stay.
Questions about blockchain are:
1. Will blockchain technology disrupt the banking industry? What will be the role of banks in the world of blockchain?
2. How will blockchain improve the standard of living across the world?
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3. Can quantum computing break blockchain?
reference:
History of blockchain. (2020). Technology | ICAEW. https://www.icaew.com/technical/technology/blockchain/blockchain- articles/what-is-blockchain/history
Mearian, L. (2019, January 29). What is blockchain? The complete guide. Computerworld. https://www.computerworld.com/article/3191077/what-is-blockchain- the-complete-guide.html
Sarmah, S. S. (2018, August 2). Understanding Blockchain Technology. Scientific & Academic Publishing. http://article.sapub.org/10.5923.j.computer.20180802.02.html
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