In order to gain a full-fledged understanding of Blockchain technology, it may be helpful to study a Blockchain example or two in practice.
In our previous blog, we covered the foundations of blockchain technology and its application to our work at Emrit. Today, let us delve into some more practical applications of this groundbreaking system as it plays a key role in redeveloping the internet. In this blog we will:
- Review basic concepts explored in the last blog, including trustless networks, immutable ledgers, and consensus mechanisms
- Develop a deeper understanding of blockchain by studying its application to real world Sectors, both potentially and already in practice
- Money Transfers
- Smart Contracts
- Personal Identity
- Logistics
- Digital Collectibles
Blockchain Basics: A Review
A Blockchain network is a decentralized one, with many access nodes at the edge of the web, as opposed to one central authority or server. It\’s often called a \”trustless network\” because it requires no trust to remain secure. Transactions or information transfers happen on this network. They are significantly more efficient than on a centralized network because they can happen across the web, at multiple access points. Each transaction or transfer, once confirmed, forms a new block in the chain. Once added to the chain, it cannot be changed or erased.
In order for a transaction or transfer to be completed, a random node on the network must execute a consensus mechanism that creates an immutable ledger of the action in the network (a new block in the blockchain). It keeps a copy of the blockchain, including every previous block, stored securely.
Consensus Mechanism
A consensus mechanism usually involves multiple nodes challenging one another for the accuracy of their information and involves one node \”winning.\” The node that successfully confirms the transaction creates a new block in the blockchain and keeps an immutable copy of the chain. The operator of the node is usually rewarded in cryptocurrency (also called, \”mining\”).
A consensus mechanism can be proof of work (which requires nodes to contribute computing power by completing a math problem), proof of stake (which requires nodes to stake cryptocurrency on the validity of information), or proof of coverage (which involves nodes in proximity to one another challenging each other for the validity of their signal).
More consensus mechanisms are emerging as the technology advances, and each user of Blockchain technology makes use of a different mechanism, according to the function of each network.
Since each consensus mechanism is based on the validity of information, blockchain technology allows the network to remain secure from outsiders and makes it impossible to breach.
Indeed, the primary purpose of this technology, beyond energy efficiency, is to guarantee the security of personal information and the validity of transactions. Because a decentralized network is quasi impossible to hack, and each access node retains a copy of the network\’s immutable ledger, the information involved in the transaction or transfer cannot be altered or stolen.
For a more detailed explanation of all of these principles, be sure to catch our last blog!
Examples of Blockchain Technology in Action
That\’s all well and good, you say. Blockchain sounds like a great way to keep information secure. But what does that mean for us? How can Blockchain actually be used in the real world?
The good news is that it already is. There are many examples of Blockchain technology emerging in a variety of sectors, pending the rollout of new infrastructure and ideas. From financial transactions to logistics networks, Blockchain is changing the way the world operates. Let\’s take a look at specific cases.
Money Transfer
Cryptocurrencies have already established themselves alongside fiat currencies (\”real\” money) as valid units of wealth around the world. All of them are Blockchain-based.
What started with Bitcoin has come to encompass a vast, growing collection of various currencies. All of those currencies use Blockchain technology to ensure valid and secure transactions. That\’s essential when you don\’t have a physical \”bitcoin bill\” to give to someone.
Bitcoin and cryptocurrency in general, would not be able to be traded fairly and securely if it wasn\’t for Blockchain. For non-tangible units of wealth, you need an un-hackable, immutable ledger of transactions to guarantee investors that their cryptocurrency can\’t be stolen – and is actually theirs.
There are already many digital currency trading apps available, all of which make use of Blockchain. Established financial services can use Blockchain to secure their network, too.
Smart Contracts
Blockchain isn\’t just for cryptocurrency, however. Blockchain can be used to guarantee and enforce contractual obligations in any sector. A smart contract is one insured by Blockchain technology.
Take the music industry, for instance. Using Blockchain technology, the application Mediachain has granted artists the ability to demand higher royalties from streaming services – and actually be paid on time and in full.
Other applications are taking advantage of Blockchain in the real estate sector, for instance, making significant purchases infinitely more secure.
And shipping company DHL is at the forefront of using Blockchain technology to keep an immutable ledger of shipments and maintain the integrity of their service. Blockchain is helping companies up and down the supply chain keep their supply chains functioning properly.
Securing Personal Identity
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Blockchain technology does not have to apply to only financial transactions. In fact, it\’s an incredible system for securing and storing sensitive information in an unbreachable network. In an age when identity theft has become rampant, and data leaks happen right under our noses, Blockchain is not only a convenient but necessary upgrade.
Its use in healthcare has already begun to take off. New applications and systems of doctor-patient information transfer use Blockchain to keep privileged, sensitive information like your medical records away from prying eyes. Depending on what system your healthcare professionals use, you might already be making use of a Blockchain-secured network!
At a government level, Blockchain can be used to keep key information and documents, such as social security numbers and birth certificates in a secured digital place. The Illinois Blockchain Initiative is a state-sponsored program in Illinois that has already begun securely digitizing citizen information.
Thanks to distributed ledger technology, your information is further from being stolen than ever before.
Internet of Things
Blockchain technology has vast uses in IoT networks. An Internet of Things (IoT) is a network between sensors, databases, and other non-human systems that automatically transfers information from one point to the next without interacting with a human being.
Many home security devices and environmental sensors are on an IoT network to collect data, for example. They can use Blockchain technology to record and exchange sensor data securely.
The Helium Network, of which Emrit is the largest miner worldwide, uses a Blockchain platform to establish a safe information-sharing network for home security devices. Access nodes in the Helium network, like Emrit\’s CoolSpot, use home WiFi connections to provide secure proof of coverage to smart home devices on the Helium network.
Powered by Blockchain, you can rest assured that your home\’s security devices will never be hacked.
Non-Fungible Tokens and Other Digital Collectibles
Unless you\’ve been living under a rock these past few years, you must have encountered NFTs already. Non-Fungible Tokens are digital artifacts that maintain their value and uniqueness through Blockchain technology.
Without Blockchain, how could anyone say they \”own\” a digital artwork, meme, or video clip, for instance? Thanks to NFT marketplaces like Dapper Labs or Candy, which are based on a Blockchain network, officially licensed, non-tangible collectibles can be owned and traded like a real Picasso might.
Unconvinced of the efficacy of the NFT market? Hundreds of millions in confirmed sales, backed by Blockchain, would disagree with you.
Summary: With Each Blockchain Example, a World of Possibilities
Blockchain technology may still be growing and evolving, but it\’s already having a significant impact of just about every sector imaginable. From financial transactions and secure contracts to impenetrable information databases and transfers, Blockchain has a variety of uses that are destined to change the way we use our digital space. In today’s blog we covered:
- A concise review of the Basics of Blockchain from the definition of a trustless network to consensus mechanisms
- An exploration of concrete examples of Blockchain in use and how the technology is impacting a wide variety of sectors, from the financial sector to the healthcare sector
Emrit aims to play a part in the growing possibilities of Blockchain technology. As a distributed blockchain infrastructure company, our goal is to design and distribute hardware and software to build and reinforce Blockchain networks across the internet.
For more on our business, our critical role in Helium mining, and our projects in development, browse our website, join our project, and subscribe to this blog. In the coming weeks, we\’ll be taking a deep dive into various aspects of our work and its practical applications.
