What is blockchain technology? [All knowledge you need to know]

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What is blockchain

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Origin of Blockchain

In 1991, Blockchain was described in by W. Scott Stornetta and Stuart Haber. The goal is to timestamp the document so that it becomes immutable. This means you cannot modify the date in any way.

In 2008, world finance collapsed. The golden time for an anonymous character or group is called Satoshi Nakamoto Create an open source protocol called Bitcoin.

Don't get confused about Bitcoin "Bitcoin is an asset and is important if you are an investor". The most interesting thing is not price up or down, but it is Blockchain technology.

Blockchain world for the first time!

What is blockchain?

Blockchain is a chain of blocks containing information. Right from the very name it says it all - block (block) and chain (chain).

Blockchain It is like a main accounting book (ledger) of a company. where all of the company's money-related activities are closely monitored.

In this case, Blockchain is a ledger operating in the field of technology, and stored data is digital data.

Watch now Video below to learn more about Blockchain blockchain technology

What is blockchain used for?

Blockchains are used to store information in interconnected information blocks. It is managed by everyone participating in the system.

Instead of an individual 3rd party like the state or central bank. It also allows secure transmission of data by a complex encryption system, and is expanded over time.

Moreover, this technology was created to combat data changes in the system. It There is also a very special feature that the data transmission does not require any intermediary to confirm the information.

Because in the Blockchain system, there are many independent nodes capable of authenticating information in the system without requiring "signs of belief".

Information when entered blockchain block chain it cannot be changed and added only with the approval of everyone in the system.

This is a system to ensure very high safety for data against the risk of theft.

Especially sensitive data such as online bank accounts, payment card accounts ... Even if one part of the blockchain system is attacked, the other parts are not affected and continue to operate to ensure information protection.

Watch a video about Blockchain experts' perspective

The structure of Blockchain

Each block will be stored in 3 parts:

  • Data
  • Hash of the current block
  • Hash block first

block

Data

Data will depend on the type of Blockchain. Bitcoin's blockchain, for example, will contain transaction data.

Transaction data includes: Information of sender, receiver and number of coins sent.

Hash of the current block

Hash of the current block as a set point for identification. It is unique and does not overlap like our fingerprints.

Hash of the previous block

Thanks to this hash, the associated blocks create a chain. However the first block will not be associated with any blocks. Because it was created first.

This first block is called Genesis block which translates into Vietnamese as "primitive block".

Anatomy of Blockchain

Main features of Blockchain technology

Blockchain technology acts as a ledger recording all transactions that occur in the system. The main features of blockchain include:

  • Cannot be fake, can't destroy blockchain chains:
  • Invariant
  • Data security
  • transparent
  • Smart contract

Cannot be fake, can't destroy blockchain chains

Blockchain chains are nearly indestructible. In theory, only quantum computers can interfere and decode blockchain chains.

It will only be completely destroyed when there is no internet worldwide.

Invariant

Data in blockchain is nearly immutable. It can only be modified by the person who created it.

But there must be consensus of nodes on the network and that data will remain forever.

Data security

The information and data in blockchain chains are distributed and absolutely safe. Only the holder of the private key has access to that data.

Data security

transparent

Anyone can follow the path of data in the blockchain from one address to another address and can statistics the entire history on that address.

Smart contract

Smart contract are digital embedded by an if-this-then-that (IFTTT) code in the system.

Allow them to execute without a third party. Blockchain does not need a third party to join the system.

It ensures that all parties are aware of the contract details and the terms are automatically fulfilled once the conditions are met.

Smart Contract

Why is it impossible to fix data on Blockchain?

Hash Mechanism

To modify the data of a block then Hash of that block will be changed. The block behind it being modified block becomes invalid. Because now Hash of the previous block not the same as the modified one.

So the only way to modify the data of a block is to make all the blocks behind it valid.

Change the information of a block

Consensus mechanism

To make the block valid, you must intervene into the block and change the Hash for a while. But because the date calculator can calculate very quickly.

Each second, they can calculate hundreds of thousands of hashes. This affects the surge protection.

At this point, it is the pure copper mechanism that will decide who will add the new block. The purpose is to prevent the string from being overwritten. From there ensure integrity and confidentiality.

Peer network (P2P Network)

The blockchain uses architecture Peer network instead of a management center. This means that anyone can join the network.

Each individual in the network acts as a node (urge). They will receive a full copy of the blockchain. They use this copy to confirm everything is still in order.

All nodes create consensus. If the consensus is greater than 50% then the block is valid and added to the block chain.

Peer networks combine with consensus to create a layer of protection against harmful activities.

How is blockchain classified?

In the Blockchain system, there are 3 main types: Public, Private and Permissioned:

Public blockchain

Public: This is a blockchain system that anyone can read and write data on.

The process of authenticating transactions on this Blockchain requires thousands or even thousands of nodes to participate.

Therefore to attack this Blockchain system is impossible because of the high cost. Example of public blockchain: Bitcoin, Ethereum...

Public blockchain

Private blockchain

Private: This is a blockchain system that allows users to only read data, not write because this belongs to an absolutely trusted third party.

This third party may or may not allow users to read data in some cases. The third party is free to decide all changes on Blockchain.

Because this is a Private Blockchain, the transaction confirmation time is quite fast because only a small number of devices are required to authenticate transactions.

For example: Ripple is a type of Private Blockchain, this system allows 20% of nodes to be fraudulent and only needs the remaining 80% to work stably.

Private Blockchain

Permissioned blockchain

Permissioned: Also known as the Consortium. This is a form of Private Blockchain but adds certain features.

It combines the "belief" when participating in Public and "absolute faith" when participating in Private.

For example: Banks or joint venture financial institutions will use their own Blockchain.

Permissioned blockchain

Main versions of Blockchain

Now blockchain technology There are 3 main versions including:

Blockchain 1.0

Blockchain 1.0 - Currency and Payment: Is the earliest and first version of the blockchain.

The main application of this version is the work related to cryptocurrencies. It includes currency conversion, remittances and the creation of a digital payment system.

This is also a field familiar to many people, sometimes quite a few people mistakenly think Bitcoin and Blockchain are one.

Blockchain 2.0

Blockchain 2.0 - Finance and Market: This is the 2nd version of blockchain.

Its applications are financial and banking processing: expanding the scale of Blockchain, bringing blockchain integration into financial and market applications.

Assets include stocks, checks, liabilities, ownership and anything related to a deal or contract.

Blockchain 3.0

Blockchain 3.0 - Designing and Monitoring activities: This is currently the highest version of the blockchain.

In this version, Blockchain technology will transcend the borders serving the financial sector only. It targets other areas such as education, government, health and the arts ...

Consensus mechanisms in Blockchain

The consensus mechanism in Blockchain can be understood as the way that everyone in the blockchain system can agree to a transaction occurring in the system. Here are the common types of consensus mechanisms in blockchain:

Proof of Work 

Proof of Work (Proof of Work) is the most popular consensus mechanism, used in Bitcoin, Ethereum, Litecoin, Dogecoin and most cryptocurrencies. This is a consensus mechanism that consumes quite a lot of power.

Proof of Work

Proof of Stake 

Proof of Stake (Proof of Stock): This is a common consensus mechanism in Decred, Peercoin and in the future, Ethereum and many other cryptocurrencies. This consensus mechanism is more decentralized, consumes less energy and is not easily threatened.

Proof of Stake

Delegated Proof-of-Stake

Delegated Proof-of-Stake (Authorization of Shares): This is a common consensus mechanism Steemit, EOS, BitShares. This consensus mechanism has low transaction costs; extendable; High energy performance. However, it is still somewhat focused because this algorithm selects a trusted person to authorize.

Proof of Authority

Proof of Authority: This is a common consensus mechanism commonly found in POA.Network, Ethereum Kovan testnet. This consensus mechanism has high performance, good scalability.

Proof-of-Weight

Proof-of-Weight (Proof of Weight / Larger The better): This is a common consensus mechanism in Algorand, Filecoin.

This consensus mechanism is customizable and scalable. However, the process of promoting development will be a big challenge.

Byzantine Fault Tolerance

Byzantine Fault Tolerance (Byzantine Consensus besieged Blockchain): This is a common consensus mechanism in Hyperledger, Stellar, Dispatch, and Ripple.

This consensus mechanism is highly productive, low-cost, scalable. But still can not completely trust.

This algorithm has 2 versions:

  • Practical Byzantine Fault Tolerance (Consensus Against Fraud / General Byzantine surrounds Blockchain in practice)
  • Federated Byzantine Agreement (Byzantine coalition agrees)

Directed Acyclic Graphs (topology algorithm): This is the consensus mechanism commonly found in Iota (Tangle technology), Hashgraph, Raiblocks / Nano (Block-lattice technology), which is a rival of Blockchain.

The application of blockchain in life

The first widely known useful application from blockchain technology is probably Bitcoin and the like virtual money.

But currently Blockchain is revolutionizing most industries. Here are a few practical examples of the application of blockchain technology in life.

Watch a video about the influence of Blockchain now

Today I will state the application of Blockchain in combination with each economic sector in Vietnam so that you can easily imagine!

Application in industry and service

Enterprises apply blockchain in their services

blockchain technology applications

Business services

Microsoft and ConsenSys are working together to provide the Ethereum Blockchain as a Service (EBaaS) on Microsoft Azure so that enterprise customers and developers can have a blockchain development environment.Enterprise blockchain application

Google is also said to be working on a proprietary blockchain to support businesses. Parent company Alphabet is developing a distributed ledger that third parties will be able to use to store data, allegedly related to Google's cloud services for businesses.

Energy industry

A project full of focus on distributed energy and water systems is using blockchain technology in Fremantle, Australia,. Solar panels are being used in a sunny area to collect electricity, then used to heat water and provide energy, and data is recorded on the blockchain.

The National Energy Commission of Chile has begun to use blockchain technology as a means of validating data regarding the country's energy use. Sensitive data will be stored on blockchain as part of the South American nation's initiative to modernize and secure the electrical infrastructure.

Application in agriculture, seafood

Fishing

Blockchain is currently being used to support sustainable fishing. Illegally caught fish is an endemic problem in the industry, and distributed ledger technology provides a means of showing where the fish was caught, processed and sold. This "net-to-plate" chain allows inspectors to determine whether the fish comes from regions notorious for human rights abuses or from countries affected by economic sanctions.

Agriculture

Do you know where your food, clothes,… come from? Supply chain management is an extremely complex field and often involves dozens of intermediaries from production to purchasing.

So how can we ensure the quality, transparency and reliability of our products on a long journey from the manufacturer to the consumers? The answer is blockchain.

  • Food industry: A Blockchain application that can improve transparency and efficiency in figuring out where and where food can be contaminated throughout the supply chain.
  • OriginTrail: A blockchain platform that allows consumers to know where the food products they buy come from and how they are manufactured.

Agriculture

Blockchain application in construction

Real Estate

Ukraine is honored to be the first country to use blockchain to facilitate an asset deal. A property that has been sold by renowned cryptocurrency supporter and TechCrunch founder Michael Arrington.

The deal is activated with the help of smart contracts on the Ethereum blockchain and is intended to be the first of many to complete by Propy, a startup specializing in real estate transactions. blockchain based.

Rail

Railway operator Novotrans in Russia is using blockchain technology with the aim of improving its operational speed. One of the largest equity miners in the country, will use blockchain to record data regarding repair requests, inventory and other issues related to their operations. The idea is that blockchain records will be more resistant to tampering and data corruption.

Land use rights

The Georgian government uses it to register title to land. They created a custom designed blockchain system and integrated it into the digital record system of the National Public Registry (NAPR). Georgia is currently taking advantage of the transparency and fraud reduction offered by blockchain technology.

Application in waste management activities

Waltonchain's RFID technology is being used by the Smart Waste Management System in China. Using Walton's blockchain, the project will enable waste level monitoring to improve operational efficiency and optimize resources.blockchain-in waste management

Application in wholesale and retail industry 

Mobile payment (Mobile payment)

Cryptocurrencies with basic blockchain technology are being used to facilitate mobile payment in a variety of projects. One of the latest initiatives announced, launched in the fall of 2018, will involve a consortium of Japanese banks. They will use the technology of Ripple to enable instant mobile payment.

Supply chain

Supply chain management is considered to be one of the most beneficial use cases for blockchain, which is ideal for industries where goods are shipped across different hands, from start to finish, or manufacturer to store. IBM and Walmart have teamed up to launch the Blockchain Food Safety Alliance in China. The project, run by Fortune 500 JD.com, is designed to improve food tracking and safety, making it easy to verify that food is safe to consume.

Blockchain applications in warehousing transportation

Shipping

The suitability of Blockchain to record shipping data is obvious. A number of projects have distributed ledger technology to operate in this area. Use it in the maritime logistics industry to bring transparency to the inevitable bureaucracy in international trade.

Two industry giants, IBM and Maersk, respectively, created the world's first shipping blockchain platform, TradeLens.blockchain application in shipping

Applications in financial operations, banking and insurance.

Finance and Banking

Bitcoin Atom

Bitcoin Atom is a new branch of Bitcoin that allows easy exchange of cryptocurrencies with no transaction fees. You cannot be hacked when trading. It makes Bitcoin really decentralized.

This technology is based on atomic swaps. This is considered an invaluable tool for exchanging cryptocurrencies and does not need a trusted third party.

But for now, the widespread adoption of atomic swaps has been prevented because they require high technical skills. Bitcoin Atom can only solve this problem in part.

Securrency

Securrency is a cryptocurrency trading platform and several types of assets, including non-cash assets.

All are exchanged through security tokens. The project allows cryptocurrencies to be traded outside of their dedicated transactions.

Ripple

Ripple aims to become a global payment solution provider. They will connect the banking provider of payment services, businesses and digital asset transactions. Transactions are instantly processed, according to global demand.

ABRA

ABRA is a global application and cryptocurrency wallet that allows you to buy, invest and store 20 cryptocurrencies, including Bitcoin, ethereum, litecoin ...

Aeternity

Aeternity is a highly scalable blockchain platform. It can be used for any application that requires high transaction speed.

Includes smart contracts created from chain, nano and micro payments.

Insurrance

Blockchain in the insurance industry is often talked about, but many people do not know the technology has been deployed. Insurance company American International Group Inc, in partnership with International Business Machines Corp, for example, has completed a pilot of a multinational policy known as a smart contract, for Standard Chartered Bank's PLC and has Complex international scope management plan through blockchain.

Blockchain application in mining

Diamond

The De Beers Group, the world-famous diamond company, now has its own blockchain called "Tracr" and is in operation, designed to set a digital record for each diamond registered on the platform. platform.blockchain application in diamonds

With concerns about the origin of diamonds and the ethics associated with their origin, along with the risk of being swapped for less valuable things. Along the line from a mining pool to a retail location, blockchain is a natural fit. Because each record is indelible, it will ensure that the data for each stone exists as long as it is diamonds.

Oil

One of the leading companies in the commodity market, S&P Global Platts, is testing a blockchain solution that is being used to record oil storage data. Weekly inventories will be stored on blockchain, reducing the need for manual data management and minimizing the possibility of human error.

Carbon

In March 3, IBM launched the Blockchain Food Safety Alliance in conjunction with the Energy-Blockchain Laboratory, as a means of tracking carbon assets in China. This creates a measurable and audited system for monitoring emissions and facilitates a tradable market for companies seeking to offset their energy consumption during the promotion. encourage green industry activities.

Energy

One of the biggest challenges for the energy industry. Companies with a transactional habit of providing surplus value need to keep a record and it's infallible. Tracking energy distribution in real time and ensuring efficient distribution across the supply chain requires a lot of data points and also requires close cooperation between all entities.

Every day, the real world blockchains project grows. From logistics to fine arts, it's hard to find an area untouched by this transformative technology. Blockchain has reached a point where technology has proven that it is superior to the present.

Blockchain application in education

In 2010, a doctorate (PhD) from former Microsoft Chinese President Tang Jun received from Pacific Western University raised questions.

Investigators discovered that not only were these schools untested, the price of the degree was still too cheap. Only need 2.595 USD and students do not need to study anything.

A year later, dozens of other senior managers were also involved in other large-scale fake diplomas from suspicious programs.

Enrollees only learn "properly". Therefore, the need for Clear Transparency is extremely necessary.Education

Intellectual Property

Piracy is a long-standing problem. It seems that there is no solution that can be completely solved until blockchain appears. Perhaps, at the moment, this technology is the only solution to the problem.

Even if you're a musician, you want to make sure you get royalties when your music is released. Or simply asserting ownership.

Blockchain technology can help us protect our assets by creating indisputable records of ownership in real time.

Intellectual Property

Application of blockchain in food service

Blockchain is also accelerating in the alcohol and beverage industry. In March 3, news emerged that premium whiskey brand Ailsa Bay will release what it believes is the world's first scotch whiskey to be tracked with a blockchain-based system.Food Service

Meanwhile in May, auditing firm Big Four E&Y announced its proprietary blockchain solution for a massive new platform that helps consumers across Asia determine quality, origin and authenticity. of imported European wine.

Application of blockchain in information and communication

Ads

The New York interactive advertising exchange in partnership with Nasdaq is using blockchain to create an electronic marketplace where brands, publishers, and agencies can buy ads. The process is very simple, although as secure as possible, using an open protocol on the Ethereum blockchain.

Newspapers

Persistence is now a hot topic in the press trade. One wrong move and years of hard work and research can go a long way. Blockchain is a smart solution to the problem.

Civil, a decentralized journalism marketplace that, in addition to obvious blockchain benefits, provides an economic incentive model for quality news content, along with the ability to permanently store content, will still have. accessible at any time.

Application in health and social life activities

Medical

When patients are examined or tested, all their results will be stored in blockchain technology. This helps the patient keep all his information and test indicators confidential.

In case the patient needs to transfer to anywhere in the world. They only need to retrieve information and find the results of their testing on the blockchain. Without having to go through the cumbersome and complicated traditional procedures.

  • the medicalcha

MedicalChain is the first healthcare company to use blockchain technology. It facilitates the storage and use of electronic medical records to provide a complete telemedicine (telemedicine) experience.

They are the actual doctors in the British health care system and want to change this system from within.

  • MedRec

MedRec provides any healthcare provider with secure access to patient records.

MedRec uses blockchains to save time, money, and repetitive processes in carrying out procedures between different facilities and suppliers.

Patients can also access their medical records to research health service providers.medical

Insurrance

Blockchain in the insurance industry is often talked about, but many people do not know the technology has been deployed. Insurance company American International Group Inc, in partnership with International Business Machines Corp, for example, has completed a pilot of a multinational policy known as a smart contract, for Standard Chartered Bank's PLC and has Complex international scope management plan through blockchain.

Health care

Popular medical records are widespread and error-prone, with inconsistent data processing procedures meaning hospitals and clinics are often forced to work with inaccurate or incomplete patient records. Healthcare projects are using blockchain as a means of supporting data sharing while providing authentication and maintaining confidentiality.

Social life

LGBT community: Blockchain can be helpful in building Germany's pink economy, as well as helping the LGBT community to fight for their rights without revealing people's identities.

The second issue is an extremely important issue because hatred crimes are a recurring problem in the gay community, especially in countries notorious for human rights violations and homosexuality. banned or at least uncomfortable because of the appearance.

Application in state management and national security

Tax

While the blockchain provides us with transparency and can control our own data. This technology does the same for governments. And that alludes to one thing: tax collection.

In China, the authorities are now using a blockchain for both taxes and electronic invoices.

The project was launched in 2017. The first blockchain invoice was created in August 8 at a local restaurant.tax

Vote

Due to complex issues in security and electoral fraud, few countries have turned to electronic voting machines (EVMs).

It's hard to deny that EVM makes voting inert more accessible. Therefore, promoting the people's participation in elections. However, most countries have commented that the risks are greater than the positives.

Blockchain can provide a solution to this problem. The immutability of blockchain means issues like dual voting. Changing votes and removing votes will be "deleted" overnight.

Blockchain will also eliminate the need for tallying and produce results almost immediately after the poll ends.vote

National security

In 2016, the US Department of Homeland Security (DHS) announced a project that will use blockchain as a means of securely storing and transmitting the data it acquires. Using the Factom blockchain, data is retrieved from security cameras and other sensors are encrypted and stored. Using blockchain as a means to minimize the risk of data breaches. The project is still ongoing.

Border control

Currently, passengers on the Eurostar train between the two countries undergo border control at multiple locations. Blockchain will provide a means to ensure that the data is not tampered with and can verify correctly.

People ID

The state of Zug in Switzerland, known as the Crypto Valley-headquarters of a group of blockchain companies, has developed a blockchain project in partnership with Uport to register residents' IDs. It allows them to participate in online voting and prove their residency.

Applications in arts, entertainment and entertainment

Crafts

Similar to the diamond trade, the art industry depends on the origin and authenticity of artwork. Although blockchain cannot validate a picture to determine whether it is original or fake, it can be used to prove the previous owner of a work.

Additionally, blockchain is currently used as a means of obtaining works of art. It's another example of how blockchain technology can be used to make tangible objects easily transacted and exchanged from anywhere in the world without the need for physical transfer from secure memory. full.

Music

One of the main benefits of blockchain technology is the way it eliminates intermediaries or intermediaries. Music is a prime example of an industry where inefficiencies have seen artists pay poorly compared to their efforts. A number of blockchain-based projects have emerged to seek a fairer deal for music composers.

For example: Inmusik, a music ecosystem that uses blockchain. Apply for listeners and musicians to make money from creating, discovering and updating content:Blockchain application in music

Gaming

With the increase of in-game purchases and in-game billing transactions. Many gamers now have a huge repository of things connected to their various accounts.

Obviously, this creates security problems. What if a hacker steals it? What if the parent company's servers are offline?

By deploying a blockchain, gamers will eventually be able to own these items and fully control their status.

Transferring in-game items to others will also become easier and safer. No one can copy them illegally.Gaming

Du Lich

Blockchain is being studied as a means to improve Hawaii's economy by giving tourists the opportunity to pay for local goods and services in Bitcoin and other currencies. In this way, the hope is to attract tourists, especially from Asia, so they can spend more money and eventually help Hawaii develop its economy.blockchain travel app

Some other blockchain applications

Protect rare animals

“Care for the Uncared” is a non-governmental organization that is collaborating with leading developers to find ways to conserve and protect endangered species using blockchain technologies.

A smart city

Smart cities are no longer just science fiction. Taipei is trying to position itself as a city of the future with the help of Distributed Ledger Technology. They have announced a partnership with IOTA, and they are working on creating tokens with detection of light, temperature, humidity, and pollution.

IOTA and smart city application

Conclusion

Above is the article "What is blockchain? Learn about the application of Blockchain blockchain technology”. Hope to help you with more useful things about block chain.

If you have any questions or would like to share your knowledge of blockchain technology. Then contact us in the comment section below. We will reply as soon as possible.

Finally, don't forget Like, Share and give us one 5 star rating below to support Virtual money blog ok

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16 COMMENTS

  1. Hello,
    I just learned about blockchain, and there are some unknown points, let me know more
    I don't understand b3 and b4 in the blockchain's money cycle
    Look forward to hearing from you

    • B3 - B4 is the process of forming that blockchain network. From other laptop and mobile devices, when BTC transact, a wider network will form

      • I just learned about blockchain, the consensus mechanism in blockchain is a bit difficult to understand, can you write more clearly?

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