Review on Blockchain
A Critical Review on Blockchain and Its Current Applications
Abstract
Blockchain technology has been known as a digital currency platform since the emergence of Bitcoin, the first and the largest of the cryptocurrencies. Blockchain has numerous benefits such as decentralization, persistency, anonymity and auditability. There is a wide spectrum of blockchain applications ranging from cryptocurrency, financial services, risk management, internet of things (IoT) to public and social services. Although a number of studies focus on using blockchain technology in various application aspects, there is no comprehensive survey on the blockchain technology in both technological and application perspectives. To fill this gap, we conduct a comprehensive survey on the blockchain technology. In particular, this paper gives the blockchain taxonomy, introduces typical blockchain consensus algorithms, reviews blockchain applications and discusses technical challenges as well as recent advances in tackling the challenges. Moreover, this paper also points out the future directions in the blockchain technology.
Introduction
Blockchain technology is quite new. Wikipedia defines it as
“a continuously growing list of records called blocks which are linked and secured using cryptography"(Wikipedia Contributors, 2018b)
The theory of decentralized crypto-currencies (e.g. Bitcoin and Altcoins) have gained rapid recognition, and are often associated with statements such as a glimpses into our future. While the Bitcoin technology has been extensively studied, we believe that the concept of the Blockchain provides a new perspective on the already existing literature by looking at the various appliances of the underlying technology in a socio-economical setting prior to its previous literary focus within finance and economics (e.g. fin-tech). While Blockchain represents a novel application on cryptography and information technology, researchers still lack to find the tipping point for the technology. Researchers agree that the Blockchain technology has certain features that is well applied within the financial industry, but still lacks to find the appropriate use of large scale Blockchain usage within modern society.
However, technologies such as automation, computing, robots and ultimately the Internet have been contributing immensely to progression and wealth of economies and cultures and thus expect that the Blockchain technology will provide further contributions.
In this paper, I will identify a representative overview of current themes in blockchain research and discuss future implications and my recommendations. While blockchain is not well understood, it is growing rapidly as a medium, and it is a really hot topic in current media. However, trends in media often do not align with trends in research, so this is also a really good exercise in seeing how trends in academic, peer-reviewed research publications covers a trending topic. Not too long ago there were hardly any academic articles at all on blockchain, however this is changing quickly.
Blockchain has numerous benefits such as decentralization, persistency, anonymity, and auditability. There is a wide spectrum of blockchain applications ranging from cryptocurrency, financial services, risk management, internet of things (IoT) to public and social services. Although a number of studies focus on using the blockchain technology in various application aspects, there is no comprehensive survey on the blockchain technology in both technological and application perspectives. To fill this gap, I conduct a comprehensive survey on the blockchain technology. In particular, this paper gives the blockchain taxonomy, introduces typical blockchain consensus algorithms, reviews blockchain applications and discusses technical challenges as well as recent advances in tackling the challenges. Moreover, this paper also points out the future directions in the blockchain technology.
What is Blockchain?
What makes this question so important?
To start, we can go back to the beginning. Recently, cryptocurrency has attracted extensive attentions from both industry and academia. Bitcoin that is often called the first cryptocurrency has enjoyed a huge success with the capital market reaching 10 billion dollars in 2016 (coindesk, 2016). The blockchain is the core mechanism for the Bitcoin. The blockchain was initially revealed in a paper called “Bitcoin: A Peer-to-Peer Electronic Cash System" by an unknown author using the pen name Satoshi Nakamoto. It was never published in a peer-reviewed journal (Nakamoto, 2008). With regard to Bitcoin, Pierro (Pierro, 2017) describes each Bitcoin as a number, and that these numbers are the solution to an equation. Each new solution to the equation generates a new bitcoin and the act of generating a solution is called “mining." Once mined, a bitcoin can be transferred or exchanged, and every transaction generates an entry into the blockchain’s activity log. This is often referred to as a “ledger." What makes the blockchain standout is that the ledger is not owned or stored by one agency, but instead every transaction conducted has a copy of the details of that transaction stored on every computer that was a part of the transaction.
(Pierro, 2017) goes on help describe the blockchain as “a table with three columns, where each row represents a distinct transaction, the first column stores the transaction’s timestamp, the second column stores the transaction’s details, and the third column stores a hash of the current transaction plus its details plus the hash of the previous transaction. By providing a time stamp and the previous transaction, parties wishing to verify this data are able to look it up at any point, and since it mentions the previous transaction, it becomes possible to track the history with relative ease.
There is some security in place to prevent those who were not a part of the transaction from viewing details about it. The hash mentioned earlier as column three that gets populated during the transaction is an encrypted string of letters and numbers that is generated to hide data about the transaction. Since every transaction’s hash can then be used to identify the previous transaction’s hash, it makes it highly improbable for fraud to occur. With each transaction containing a receipt of the previous transaction, amounts can easily be traced back to the very beginning. A trait that would make nearly every accountant’s job easier as there would not be any more lost receipts or miscalculated amounts. Each transaction is a screenshot in time that all with the right permissions can see while hiding in plain sight. (Pierro, 2017) Blockchain technology is not limited to currency though; since each transaction in the ledger is just a string value, transactions can always be traced. Cook County in Chicago has been using blockchain technology to track real estate titles as they change ownership. Basically speaking, the blockchain is a linked chain of blocks of data (Pierro, 2017).
Blockchain Architecture
Block:
A block consists of the block header and the block body as shown in Figure. In particular, the block header includes:
• Block version: indicates which set of block validation rules to follow.
• Parent block hash: a 256-bit hash value that points to the previous block.
• Merkle tree root hash: the hash value of all the transactions in the block.
• Timestamp: current timestamp as seconds since 1970-01-01T00:00 UTC.
• nBits: current hashing target in a compact format.
• Nonce: a 4-byte field, which usually starts with 0 and increases for every hash calculation
Block Structure:
Impact of the Blockchain
Blockchain can be seen as a part of the implementation layer of a distributed software system. The data integrity in distributed systems can be achieved and maintained using blockchain. Furthermore, blockchain could be also considered as a purely peer-to-peer system which is made up of the individual nodes in a network. Dishonest and malicious peers become the crucial integrity threat in peer-to-peer systems. The individual nodes try to exploit the system for their own purposes since unknown peers with unknown reliability and trustworthiness may exist. Thus, these critical problems are needed to be solved by blockchain.
Along with the blockchain Bitcoin is the most famous blockchain application, and also blockchain can be applied into diverse applications far beyond cryptocurrencies. Since it allows payments to be finished without any bank or any intermediary, blockchain can be used in various financial services such as digital assets, remittance and online payment(Petersetal.,2015; ForoglouandTsilidou,2015). Additionally,blockchain technology is becoming one of the most promising technologies for the next generation of internet interaction systems, such as smart contracts (Kosba et al., 2016), public services (Akins et al., 2013), internet of things (IoT) (Zhang and Wen, 2015), reputation systems (Sharples and Domingue, 2015) and security services (Noyes, 2016a). Despite the fact that the blockchain technology has great potential for the construction of the future internet systems, it is facing a number of technical challenges.
Firstly, scalability is a huge concern. Bitcoin block size is limited to 1MB now and a block is mined about every 10min.Subsequently, the Bitcoin network is restricted to a rate of 7 transactions per second, which is incapable of dealing with high-frequency trading.
However, larger blocks mean larger storage space and slower propagation in the network. This will lead to centralization gradually as users would like to maintain such a large blockchain. Therefore, the tradeoff between block size and security has become a challenge. Secondly, it has been proved that miners can achieve larger revenue than their fair share through selfish mining strategy
(Eyal and Sirer, 2014). Miners hide their mined blocks for more revenue in the future. In that way, branches can take place frequently; this hinders blockchain development. Hence some solutions need to be put forward to fix this problem. Moreover, it has been shown that privacy leakage can also happen in blockchain even when users only make transactions with their public key and private key (Biryukov et al., 2014). User’s real IP address could even be tracked. Furthermore, current consensus algorithms like proof of work (PoW) or proof of stake (PoS) are facing some serious problems. For example, PoW wastes too much electricity energy while the phenomenon that the rich get richer could appear in the PoS consensus process. These challenges need to be addressed in the blockchain technology development.
Digital Signature:
Each user owns a pair of private key and public key. The private key is used to sign the transactions. The digital signed transactions are spread throughout the whole network and then are accessed by public keys, which are visible to everyone in the network. Figure 3 shows an example of digital signature used in blockchain. The typical digital signature is involved with two phases: the signing phase and the verification phase. Take Figure 3 as an example again. When a user Alice wants to sign a transaction, she first generates a hash value derived from the transaction. She then encrypts this hash value by using her private key and sends to another user Bob the encrypted hash with the original data. Bob verifies the received transaction through the comparison between the decrypted hash (by using Alice’s public key) and the hash value derived from the received data by the same hash function as Alice’s. The typical digital signature algorithms used in blockchains include elliptic curve digital signature algorithm (ECDSA) (Johnson et al., 2001).
Key characteristics of blockchain In summary, blockchain has following key characteristics.
• Decentralization
In conventional centralized transaction systems, each transaction needs to be validated through the central trusted agency (e.g., the central bank) inevitably resulting the cost and the performance bottlenecks at the central servers. Differently, a transaction in the blockchain network can be conducted between any two peers (P2P) without the authentication by the central agency. In this manner, blockchain can significantly reduce the server costs (including the development cost and the operation cost) and mitigate the performance bottlenecks at the central server.
• Persistency
Since each of the transactions spreading across the network needs to be confirmed and recorded in blocks distributed in the whole network, it is nearly impossible to tamper. Additionally, each broadcasted block would be validated by other nodes and transactions would be checked. So any falsification could be detected easily.
• Anonymity.
Each user can interact with the blockchain network with a generated address. Further, a user could generate many addresses to avoid identity exposure. There is no longer any central party keeping users’ private information. This mechanism preserves a certain amount of privacy on the transactions included in the blockchain. Note that blockchain cannot guarantee the perfect privacy preservation due to the intrinsic constraint (details refer to Section 5).
• Auditability.
Since each of the transactions on the blockchain is validated and recorded with a timestamp, users can easily verify and trace the previous records through accessing any node in the distributed network. In Bitcoin blockchain, each transaction could be traced to previous transactions iteratively. It improves the traceability and the transparency of the data stored in the blockchain.
Some Remarks for the Discussion
We have discussed what the blockchain is, but why should anyone care? For seemingly being a rather ambiguous technology to the general populace, a monetary application of the blockchain has garnered a large financial backing. With the price of a Bitcoin currently being valued at about ten thousand dollars (Wikipedia & Contributors, 2018a), it seems important to see why people are investing in it. As illustrated by the thematic analysis above, blockchain has implications for a wide variety of fields. Some are more hopeful, or seem more useful, than others. While it might be too difficult to see applying blockchain to really intricate and highly regulated industries like securities at the moment (Tranquillini, 2016), we can see that it has already had some degree of success with things like product traceability (Lu & Xu, 2017).
We have also seen that many researchers are confident it can be applied to things like food security (Ahmed & Broek, 2017), city planning (Sun et al., 2016), property ownership (Ishmaev, 2017), and financial transactions (Cocco et al., 2017). The implications and challenges vary greatly between each industry. For food security, the benefits are largely tied to product traceability and preventing such issues as fraud and transmission of foodborne contagions. The benefits for city planning are largely social and focus on helping people to navigate both the infrastructure and social parameters of a city – such as trust and transparency in managing decentralized work-forces. Finances are the most obvious application of blockchain. This technology has risen to stardom primarily through blockchain and other crypto-currencies. Currencies like bitcoin and ethereum were created for blockchain, and have witnessed explosive growth. There is a greater potential for blockchain technology beyond crypto-currency itself, and it has huge implications – from increased transparency, to minimizing transaction fees by bypassing third-parties like banks. While there are challenges in implementing blockchain technologies in these industries, the benefits seem to outweigh the drawbacks in many instances. Certainly, in industries like governmental regulation, corporate governance, and securities blockchain is but one potential component of massive distributed systems, and implementation is a very delicate process that takes time. While it is unclear as to how blockchain technologies will be implemented over time, it is clear that there are enough benefits for certain industries and sectors to begin implementing it slowly and with attentiveness.
Twelve research papers which are related with blockchain applications were thoroughly discussed. The papers were carefully chosen from the online database, i.e. Google Scholar in terms of their practical implementation. The literature was searched using a keyword ’blockchain’ which yielded about 9,840 results, and finally 12 papers were considered for classification. It is obvious that the number of blockchain technology-related papers have increased significantly since it firstly appeared in 2008. It is also worth mentioned that blockchain has fascinated researchers as this technological innovation brings the possibility of cooperatively produce and maintain transactions (distributed ledger) in the network. There are tremendous advantages of blockchain such as speed, robustness, openness, and so forth. Before the transaction is appended into blockchain, all participants in the network have to reach an agreement. However, blockchain is not a universal cure for all problems and there are several issues that have been identified such as financial transaction for criminal activities, legal aspects, and other economic risks. Blockchain become one of the promising technology in the future if well exploited.
Conclusion
With blockchain technology possessing such a large appeal, we are already seeing widespread adoption. Furthermore, due to the peer-to-peer nature of the technology this technology and every stakeholder having access to their block of the ledger, cooking the books or falsifying data has never been harder. This alone has the potential to increase consumer confidence in these new technological disruptions. As with any new technology, the underpinnings are not well understood and for that reason it is difficult to say how widely adopted the technology will be.
The blockchain is highly appraised and endorsed for its decentralized infrastructure and peer-to-peer nature. However, many researches about the blockchain are shielded by Bitcoin. But blockchain could be applied to a variety of fields far beyond Bitcoin. Blockchain has shown its potential for transforming the traditional industry with its key characteristics: decentralization, persistency, anonymity and auditability. In this paper, we present a comprehensive survey on the blockchain.
We first give an overview of the blockchain technologies including blockchain architecture and key characteristics of the blockchain. We then discuss the typical consensus algorithms used in the blockchain. We analyze and compare these protocols in different respects. We also investigate typical blockchain applications. Furthermore, we list some challenges and problems that would hinder blockchain development and summarize some existing approaches for solving these problems. Some possible future directions are also discussed.
Future research should delve into these topics and new applied applications, as well as study adoption rates of the technology. For those who do adapt blockchain, further study would grant us insight as to what increases (if any) in productivity have been recorded. Studies may also focus on roadblocks as to why this technology has not been adopted as well as investigate trends in consumer confidence. Additionally, as technology increases, future studies may help shed light on any security issues not initially discovered. With what started as some posted code by an anonymous programmer with a goal of creating a new currency platform, blockchain has skyrocketed in popularity, with nearly every industry from finance and healthcare, all the way to education and city planning. In conclusion, blockchain technology appears to not only improve tasks in current industries, but also hold the potential to revolutionize systems that keep track of the history of artifacts through a vastly improved, transparent ledger system.
References
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Abstract
Blockchain technology has been known as a digital currency platform since the emergence of Bitcoin, the first and the largest of the cryptocurrencies. Blockchain has numerous benefits such as decentralization, persistency, anonymity and auditability. There is a wide spectrum of blockchain applications ranging from cryptocurrency, financial services, risk management, internet of things (IoT) to public and social services. Although a number of studies focus on using blockchain technology in various application aspects, there is no comprehensive survey on the blockchain technology in both technological and application perspectives. To fill this gap, we conduct a comprehensive survey on the blockchain technology. In particular, this paper gives the blockchain taxonomy, introduces typical blockchain consensus algorithms, reviews blockchain applications and discusses technical challenges as well as recent advances in tackling the challenges. Moreover, this paper also points out the future directions in the blockchain technology.
Introduction
Blockchain technology is quite new. Wikipedia defines it as
“a continuously growing list of records called blocks which are linked and secured using cryptography"(Wikipedia Contributors, 2018b)
The theory of decentralized crypto-currencies (e.g. Bitcoin and Altcoins) have gained rapid recognition, and are often associated with statements such as a glimpses into our future. While the Bitcoin technology has been extensively studied, we believe that the concept of the Blockchain provides a new perspective on the already existing literature by looking at the various appliances of the underlying technology in a socio-economical setting prior to its previous literary focus within finance and economics (e.g. fin-tech). While Blockchain represents a novel application on cryptography and information technology, researchers still lack to find the tipping point for the technology. Researchers agree that the Blockchain technology has certain features that is well applied within the financial industry, but still lacks to find the appropriate use of large scale Blockchain usage within modern society.
However, technologies such as automation, computing, robots and ultimately the Internet have been contributing immensely to progression and wealth of economies and cultures and thus expect that the Blockchain technology will provide further contributions.
In this paper, I will identify a representative overview of current themes in blockchain research and discuss future implications and my recommendations. While blockchain is not well understood, it is growing rapidly as a medium, and it is a really hot topic in current media. However, trends in media often do not align with trends in research, so this is also a really good exercise in seeing how trends in academic, peer-reviewed research publications covers a trending topic. Not too long ago there were hardly any academic articles at all on blockchain, however this is changing quickly.
Blockchain has numerous benefits such as decentralization, persistency, anonymity, and auditability. There is a wide spectrum of blockchain applications ranging from cryptocurrency, financial services, risk management, internet of things (IoT) to public and social services. Although a number of studies focus on using the blockchain technology in various application aspects, there is no comprehensive survey on the blockchain technology in both technological and application perspectives. To fill this gap, I conduct a comprehensive survey on the blockchain technology. In particular, this paper gives the blockchain taxonomy, introduces typical blockchain consensus algorithms, reviews blockchain applications and discusses technical challenges as well as recent advances in tackling the challenges. Moreover, this paper also points out the future directions in the blockchain technology.
What is Blockchain?
What makes this question so important?
To start, we can go back to the beginning. Recently, cryptocurrency has attracted extensive attentions from both industry and academia. Bitcoin that is often called the first cryptocurrency has enjoyed a huge success with the capital market reaching 10 billion dollars in 2016 (coindesk, 2016). The blockchain is the core mechanism for the Bitcoin. The blockchain was initially revealed in a paper called “Bitcoin: A Peer-to-Peer Electronic Cash System" by an unknown author using the pen name Satoshi Nakamoto. It was never published in a peer-reviewed journal (Nakamoto, 2008). With regard to Bitcoin, Pierro (Pierro, 2017) describes each Bitcoin as a number, and that these numbers are the solution to an equation. Each new solution to the equation generates a new bitcoin and the act of generating a solution is called “mining." Once mined, a bitcoin can be transferred or exchanged, and every transaction generates an entry into the blockchain’s activity log. This is often referred to as a “ledger." What makes the blockchain standout is that the ledger is not owned or stored by one agency, but instead every transaction conducted has a copy of the details of that transaction stored on every computer that was a part of the transaction.
(Pierro, 2017) goes on help describe the blockchain as “a table with three columns, where each row represents a distinct transaction, the first column stores the transaction’s timestamp, the second column stores the transaction’s details, and the third column stores a hash of the current transaction plus its details plus the hash of the previous transaction. By providing a time stamp and the previous transaction, parties wishing to verify this data are able to look it up at any point, and since it mentions the previous transaction, it becomes possible to track the history with relative ease.
There is some security in place to prevent those who were not a part of the transaction from viewing details about it. The hash mentioned earlier as column three that gets populated during the transaction is an encrypted string of letters and numbers that is generated to hide data about the transaction. Since every transaction’s hash can then be used to identify the previous transaction’s hash, it makes it highly improbable for fraud to occur. With each transaction containing a receipt of the previous transaction, amounts can easily be traced back to the very beginning. A trait that would make nearly every accountant’s job easier as there would not be any more lost receipts or miscalculated amounts. Each transaction is a screenshot in time that all with the right permissions can see while hiding in plain sight. (Pierro, 2017) Blockchain technology is not limited to currency though; since each transaction in the ledger is just a string value, transactions can always be traced. Cook County in Chicago has been using blockchain technology to track real estate titles as they change ownership. Basically speaking, the blockchain is a linked chain of blocks of data (Pierro, 2017).
Blockchain Architecture
Block:
A block consists of the block header and the block body as shown in Figure. In particular, the block header includes:
• Block version: indicates which set of block validation rules to follow.
• Parent block hash: a 256-bit hash value that points to the previous block.
• Merkle tree root hash: the hash value of all the transactions in the block.
• Timestamp: current timestamp as seconds since 1970-01-01T00:00 UTC.
• nBits: current hashing target in a compact format.
• Nonce: a 4-byte field, which usually starts with 0 and increases for every hash calculation
Block Structure:
Impact of the Blockchain
Blockchain can be seen as a part of the implementation layer of a distributed software system. The data integrity in distributed systems can be achieved and maintained using blockchain. Furthermore, blockchain could be also considered as a purely peer-to-peer system which is made up of the individual nodes in a network. Dishonest and malicious peers become the crucial integrity threat in peer-to-peer systems. The individual nodes try to exploit the system for their own purposes since unknown peers with unknown reliability and trustworthiness may exist. Thus, these critical problems are needed to be solved by blockchain.
Along with the blockchain Bitcoin is the most famous blockchain application, and also blockchain can be applied into diverse applications far beyond cryptocurrencies. Since it allows payments to be finished without any bank or any intermediary, blockchain can be used in various financial services such as digital assets, remittance and online payment(Petersetal.,2015; ForoglouandTsilidou,2015). Additionally,blockchain technology is becoming one of the most promising technologies for the next generation of internet interaction systems, such as smart contracts (Kosba et al., 2016), public services (Akins et al., 2013), internet of things (IoT) (Zhang and Wen, 2015), reputation systems (Sharples and Domingue, 2015) and security services (Noyes, 2016a). Despite the fact that the blockchain technology has great potential for the construction of the future internet systems, it is facing a number of technical challenges.
Firstly, scalability is a huge concern. Bitcoin block size is limited to 1MB now and a block is mined about every 10min.Subsequently, the Bitcoin network is restricted to a rate of 7 transactions per second, which is incapable of dealing with high-frequency trading.
However, larger blocks mean larger storage space and slower propagation in the network. This will lead to centralization gradually as users would like to maintain such a large blockchain. Therefore, the tradeoff between block size and security has become a challenge. Secondly, it has been proved that miners can achieve larger revenue than their fair share through selfish mining strategy
(Eyal and Sirer, 2014). Miners hide their mined blocks for more revenue in the future. In that way, branches can take place frequently; this hinders blockchain development. Hence some solutions need to be put forward to fix this problem. Moreover, it has been shown that privacy leakage can also happen in blockchain even when users only make transactions with their public key and private key (Biryukov et al., 2014). User’s real IP address could even be tracked. Furthermore, current consensus algorithms like proof of work (PoW) or proof of stake (PoS) are facing some serious problems. For example, PoW wastes too much electricity energy while the phenomenon that the rich get richer could appear in the PoS consensus process. These challenges need to be addressed in the blockchain technology development.
Digital Signature:
Each user owns a pair of private key and public key. The private key is used to sign the transactions. The digital signed transactions are spread throughout the whole network and then are accessed by public keys, which are visible to everyone in the network. Figure 3 shows an example of digital signature used in blockchain. The typical digital signature is involved with two phases: the signing phase and the verification phase. Take Figure 3 as an example again. When a user Alice wants to sign a transaction, she first generates a hash value derived from the transaction. She then encrypts this hash value by using her private key and sends to another user Bob the encrypted hash with the original data. Bob verifies the received transaction through the comparison between the decrypted hash (by using Alice’s public key) and the hash value derived from the received data by the same hash function as Alice’s. The typical digital signature algorithms used in blockchains include elliptic curve digital signature algorithm (ECDSA) (Johnson et al., 2001).
Key characteristics of blockchain In summary, blockchain has following key characteristics.
• Decentralization
In conventional centralized transaction systems, each transaction needs to be validated through the central trusted agency (e.g., the central bank) inevitably resulting the cost and the performance bottlenecks at the central servers. Differently, a transaction in the blockchain network can be conducted between any two peers (P2P) without the authentication by the central agency. In this manner, blockchain can significantly reduce the server costs (including the development cost and the operation cost) and mitigate the performance bottlenecks at the central server.
• Persistency
Since each of the transactions spreading across the network needs to be confirmed and recorded in blocks distributed in the whole network, it is nearly impossible to tamper. Additionally, each broadcasted block would be validated by other nodes and transactions would be checked. So any falsification could be detected easily.
• Anonymity.
Each user can interact with the blockchain network with a generated address. Further, a user could generate many addresses to avoid identity exposure. There is no longer any central party keeping users’ private information. This mechanism preserves a certain amount of privacy on the transactions included in the blockchain. Note that blockchain cannot guarantee the perfect privacy preservation due to the intrinsic constraint (details refer to Section 5).
• Auditability.
Since each of the transactions on the blockchain is validated and recorded with a timestamp, users can easily verify and trace the previous records through accessing any node in the distributed network. In Bitcoin blockchain, each transaction could be traced to previous transactions iteratively. It improves the traceability and the transparency of the data stored in the blockchain.
Some Remarks for the Discussion
We have discussed what the blockchain is, but why should anyone care? For seemingly being a rather ambiguous technology to the general populace, a monetary application of the blockchain has garnered a large financial backing. With the price of a Bitcoin currently being valued at about ten thousand dollars (Wikipedia & Contributors, 2018a), it seems important to see why people are investing in it. As illustrated by the thematic analysis above, blockchain has implications for a wide variety of fields. Some are more hopeful, or seem more useful, than others. While it might be too difficult to see applying blockchain to really intricate and highly regulated industries like securities at the moment (Tranquillini, 2016), we can see that it has already had some degree of success with things like product traceability (Lu & Xu, 2017).
We have also seen that many researchers are confident it can be applied to things like food security (Ahmed & Broek, 2017), city planning (Sun et al., 2016), property ownership (Ishmaev, 2017), and financial transactions (Cocco et al., 2017). The implications and challenges vary greatly between each industry. For food security, the benefits are largely tied to product traceability and preventing such issues as fraud and transmission of foodborne contagions. The benefits for city planning are largely social and focus on helping people to navigate both the infrastructure and social parameters of a city – such as trust and transparency in managing decentralized work-forces. Finances are the most obvious application of blockchain. This technology has risen to stardom primarily through blockchain and other crypto-currencies. Currencies like bitcoin and ethereum were created for blockchain, and have witnessed explosive growth. There is a greater potential for blockchain technology beyond crypto-currency itself, and it has huge implications – from increased transparency, to minimizing transaction fees by bypassing third-parties like banks. While there are challenges in implementing blockchain technologies in these industries, the benefits seem to outweigh the drawbacks in many instances. Certainly, in industries like governmental regulation, corporate governance, and securities blockchain is but one potential component of massive distributed systems, and implementation is a very delicate process that takes time. While it is unclear as to how blockchain technologies will be implemented over time, it is clear that there are enough benefits for certain industries and sectors to begin implementing it slowly and with attentiveness.
Twelve research papers which are related with blockchain applications were thoroughly discussed. The papers were carefully chosen from the online database, i.e. Google Scholar in terms of their practical implementation. The literature was searched using a keyword ’blockchain’ which yielded about 9,840 results, and finally 12 papers were considered for classification. It is obvious that the number of blockchain technology-related papers have increased significantly since it firstly appeared in 2008. It is also worth mentioned that blockchain has fascinated researchers as this technological innovation brings the possibility of cooperatively produce and maintain transactions (distributed ledger) in the network. There are tremendous advantages of blockchain such as speed, robustness, openness, and so forth. Before the transaction is appended into blockchain, all participants in the network have to reach an agreement. However, blockchain is not a universal cure for all problems and there are several issues that have been identified such as financial transaction for criminal activities, legal aspects, and other economic risks. Blockchain become one of the promising technology in the future if well exploited.
Conclusion
With blockchain technology possessing such a large appeal, we are already seeing widespread adoption. Furthermore, due to the peer-to-peer nature of the technology this technology and every stakeholder having access to their block of the ledger, cooking the books or falsifying data has never been harder. This alone has the potential to increase consumer confidence in these new technological disruptions. As with any new technology, the underpinnings are not well understood and for that reason it is difficult to say how widely adopted the technology will be.
The blockchain is highly appraised and endorsed for its decentralized infrastructure and peer-to-peer nature. However, many researches about the blockchain are shielded by Bitcoin. But blockchain could be applied to a variety of fields far beyond Bitcoin. Blockchain has shown its potential for transforming the traditional industry with its key characteristics: decentralization, persistency, anonymity and auditability. In this paper, we present a comprehensive survey on the blockchain.
We first give an overview of the blockchain technologies including blockchain architecture and key characteristics of the blockchain. We then discuss the typical consensus algorithms used in the blockchain. We analyze and compare these protocols in different respects. We also investigate typical blockchain applications. Furthermore, we list some challenges and problems that would hinder blockchain development and summarize some existing approaches for solving these problems. Some possible future directions are also discussed.
Future research should delve into these topics and new applied applications, as well as study adoption rates of the technology. For those who do adapt blockchain, further study would grant us insight as to what increases (if any) in productivity have been recorded. Studies may also focus on roadblocks as to why this technology has not been adopted as well as investigate trends in consumer confidence. Additionally, as technology increases, future studies may help shed light on any security issues not initially discovered. With what started as some posted code by an anonymous programmer with a goal of creating a new currency platform, blockchain has skyrocketed in popularity, with nearly every industry from finance and healthcare, all the way to education and city planning. In conclusion, blockchain technology appears to not only improve tasks in current industries, but also hold the potential to revolutionize systems that keep track of the history of artifacts through a vastly improved, transparent ledger system.
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