Objective : become aware of the ongoing s/w development & technological innovation taking place.
Objective : Explore the dynamics of cryptocurrency in global eco-finance to assess market potential & risks
Objective : Understand the concepts deployed on blockchain & their industrial use cases
Objectives : A deeper dive to learn the blockchain components & how they work together.
- digital signatures
- cryptographic hashing
- consensus protocol
- verification nodes
Students will learn the mechanisms of how the blockchain system remains secure & immutable. They will be able to identify the components & interactions of a blockchain ecosystem, with the comprehension of how a decentralized governance model functions.
Module 1 : Blockchain Introduction (1 -1.5 hrs)
Objectives : Learn the innovation behind Blockchain, how & why Blockchain was created. Become aware of the basic characteristics of Blockchain models/types that are leading web3.0 evolution.
Upon completion of this Module, students will be able to answer the following :
- List the differences & similarities between DLT & Blockchain
- What is the True innovation behind the Blockchain ?
- For what was Blockchain 1.0 designed ?
- What is Blockchain 2.0 ?
- List the characteristics of permissionless & permissioned Blockchains
- List Blockchain network typologies
Blockchains can be classified into two types Private or Public - depending on who owns or manages the blockchain.
Most blockchains are private, also referred to as permissioned blockchains - they are owned by a central authority that manages the blockchain. Permissions on who and how their blockchain can be used, viewed and modified are set by this central authority. Since all corporations must function in a hierarchical system based on authorized participation - there are blockchain projects & products that design private blockchain solutions suited for coporate use cases.
Public blockchains are not owned by any central authority nor corporation . As such these blockchains are open for everyone to use without restrictions.
For example, you can easily download a bitcoin wallet and begin using the bitcoin blockchain by transacting (sending or receiving) the cryptocurrency bitcoin.
Public blockchains also allow for anybody to participate in the network by running the blockchain on their computer.
In private blockchains, governance is dictated by a CEO or selected board members. Whereas governance of public blockchain, is achieved by consensus of the participants in the network. Participants manage the blockchain according to set rules, which allow the blockchain to remain transparent, neutral & censorship resistant.
Open participation in public blockchains can prevent a single entity from taking over control of the blockchain. Therefore the more diversified participants in the network, the more the blockchain has decentralized governance.
Hybrid blockchains is a term used to describe blockchains that can be managed by a consortium or a federation. These are blockchains that support varying degrees of centralization, that may allow the blockchain to support some properties of public blockchains. However since permission is restricted to who can be part of the federation or consortium, these blockchains are not decentralized.
Bitcoin blockchain is the original public blockchain. It was designed to serve a specific purpose - a public digital ledger that functions within a governance model that supports decentralized properties.
Having the most extensive network of participants (nodes & miners) running the powerful consensus protocol (PoW) - Bitcoin has achieved to be the most decentralized blockchain.
Once data is recorded on the blockchain, it cannot be changed thus making the bitcoin blockchain the most immutable and secure.
However because of its design, application of blockchain can be tricky and inefficient in systems that require high throughput. Also, companies & private institutions can only function within a centralized governed environment. Therefore public decentralized blockchains cannot be employed in all industries. Most blockchain solutions are private centralized variants, infact some are simply DLTs.
There is no doubt blockchain will transform many industries, however understanding the differences, and the advantages/disadvantages of blockchain is the keys to success.
We hear blockchain and DLT terms used interchangeably, however they are not necessarily the same.
A distributed ledger is any type of synchronized database spread across multiple sites or participants – as oppose to a centralized model of database being managed and stored on selected servers.
Blockchain technology refers to how data is stored and secured.
Blockchain is basically a database that stores transactional records in chronological order within data block structures. The blocks are cryptographically linked to form a growing chain as new blocks are added. The Cryptographic links that form the chain are meant to impede manipulation of the recorded data in the blocks – modifications to a block in the chain breaks the integrity of the blockchain
As blockchains are also distributed, copies of the blockchain are maintained by participants of its network.
So both DLTs and blockchain technologies are distributed type of databases. However, DLTs are not necessarily linked cryptographically in a sequence of blocks which form a chain - So not all DLTs are blockchain, but all blockchains are a type of a distributed ledger.
You will read that blockchain is a form of distributed ledger technology (DLT) . Basically, a ledger that keeps accounting data - the oldest type of database known in history. For as long as civilizations have been engaging in trade or organized systems of government, methods of record keeping using ledger have been in use.
With the advent of the internet we began digitizing the ledger, and eventually in 1990 distributed ledgers where designed to manage document updates using timestamps across servers. A decade later the DLT concept was taken further by designing block structure to hold data.
Between 1990s and early 2000s, there were a series of developments toward digital currencies based on various cryptographic concepts.
Most notably, 1998 Nick Szabo created a digital currency: Bitgold . It was the first attempt at blockchain based cryptocurrency for peer to peer transactions. However digital assets are easily duplicated and BitGold was not able to resolve the common issue of double spending for peer-to-peer digital currencies without third party entities to authorize transactions.
In 2008 blockchain was fully developed, by someone going under the pseudonym of Satoshi Nakamoto published the paper, Bitcoin: A Peer-to-Peer Electronic Cash System. Bitcoins blockchain solution is the first blockchain to solve the double spending problem without needing any centralized authority as financial institutions are used today - hence Bitcoin introduced the first decentralized blockchain solution for p2p transactions.
“Blockchain is revolutionary ! Everybody should use blockchain ! We should put everything on the Blockchain !!!!!”
A blockchain for tree planting sustainability program , or blockchain for webcam models, or a blockchain for Alchemy projects ….the uses are endless. Just google any idea and most likely you will find a blockchain project on it.
The truth is, BLOCKCHAIN has become a marketing term. Starting in 2017, we experienced an explosion in the cryptocurrency market. Blockchain started being touted as the new innovation that will change the world.
A lot of people stepped into this emerging industry to take advantage of this hype. New companies began to amass millions in crowd funding and VC capital through ICOs for blockchain projects that had no viable use cases. To this day, there is a continuous flow of new blockchain initiatives with only a handful that seem promising.
Lack of knowledge of blockchain and its purpose has made lucrative “business” opportunities for scammers and fraudsters. In 2018, a company misleadingly added the word blockchain to their name to successfully boost their share prices. And around 2015 with one of the biggest scams in crypto history, OneCoin marketed itself as the crypto financial revolution - claiming to be blockchain solution to rival Bitcoin. To this day it has no blockchain but rather managed to build a ponzi scheme that has stolen an equivalent of 4 Billion euros around the globe from people eager to make money from the blockchain revolution. As the crypto adoption grows, scams continue to cause volatility in the cryptocurrency market, a recent notable case of Plus token scam which liquidated or laundered thousands of Bitcoin and Ethereum onto the market. It is speculated to have caused the sudden drop in Bitcoin and Ethereum price in early December 2019.
Blockchain is part of our 4th industrial revolution – a Web 3.0 digital revolution with IoT and 5G/6G integrating global economies using digital currencies. The most disruptive innovation will be new monetary, financial & corporate systems running on the internet as autonomous entities using concepts like P2P cryptocurrencies, DApps, & DAO built on top of decentralized blockchains.
These new concepts and their impacts on our lives are hard to grasp for most people – therefore it easy misguide people on what is really blockchain.
To start your education on blockchain without getting into heavy technical details - read the following short blogs the Birth of Blockchain, Blockchain vs DLTs, Not all Blockchains are the Same, Bitcoin the original Blockchain.
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