Distributed ledger technology or Distributed Database are the latest buzzwords in the technological spectrum. When someone hears about distributed ledgers, the first term or concept that crosses one’s mind is blockchain. People tend to swap between distributed ledgers and blockchain when in reality blockchain is just one type of distributed ledger technology. It can be told as the first variant of the technology.
Coming to Blockchain – the key buzzword within this realm, it is a distributed database which is used to maintain the continuously growing list (chain) of records called blocks. The following were the milestones that were passed with regard to blockchain:
1991: an introduction to the cryptographically secured chain of blocks
1992: Merkle tree concept was incorporated
2008: implementation of the first practical blockchain.
A person or a group identified only by the name Satoshi Nakamoto brought to practicality the first public blockchain and its application – a cryptocurrency called Bitcoin. In the bitcoin blockchain, the ideal size of each block is 1MB with some crossing the limit to more than 2MB. As per reports of Jan 2019, the size of this blockchain has reached 197GB.
The blockchain technology market is growing rapidly as the organizations are focusing more on transparency and scalability in their operations. The global blockchain technology market is projected to grow from USD 210.2 million in 2016 to USD 2,312.5 million by 2021.
The key drivers of the blockchain systems such as that of bitcoin are the identities called miners. They are the drivers of the system because each transaction is verified by miners. In the traditional method known as proof of work: An algorithm where a group of miners solve a puzzle and gets rewarded based on their computing speed. Higher the computing speed, more assurance of rewards.
Ethereum another prominent blockchain network is placing its bet on proof of stake: An algorithm where the solution for a puzzle is taken from a miner based on his stake – the weight of his wealth. Ethereum is doing R&D on implementing PoS by doing a hard fork.
Decentralized or Distributed technology as such considered to revolutionize the banking and financial sector. When a person hears the term blockchain, it is now being linked to cryptocurrencies and banking only. The distributed network, however, has more applications in the real-estate sector, government applications, stock market applications, supply chain logistics and much more. The technology is still in its infancy along with its other variants such as the Hyperledger, Hashgraph etc being introduced.
However, with the correct utilization of this technology augmented with the likes of AI and IoT, this technology will be a boon for the future. Though with advantages and pros come disadvantages and cons. We will be sharing another detailed blog on the potential applications and misuse of the technology. Stay tuned…
TA is one to never shy away from the trends of the time. Pioneers in the mobile application development and VR development, TA is currently in the works of creating a proof of concept in blockchain and the distributed ledger technologies.
Want to know what we are up to? Keep following our website and social media pages to know more of the activities of #TeamTA.