Relational databases(RDBMS) have been used as centralized data stores to support transaction processing and operations in the enterprise. Due to security concerns, databases inside the company were rarely shared with other companies.
Block chaining, on the other hand, is a new type of database technology optimized for special types of transaction processing. Block chaining is a distributed transaction database that is designed to increase transparency, security, and efficiency, and is shared among block-chain participants.
A block chain is a database that contains replicated copies of the database on multiple nodes, with each transaction occurring between two or more parties. Blocks stored at each node store details about the transaction, such as the seller, buyer, price, and contract terms. Transactions validate across the entire network with a unique signature of two or more block-chain participants through encryption within the common network. Transactions are recognized as valid transactions only if the encrypted result is the same on all nodes. A valid transaction is added to an existing chain of transactions, but if the block is not valid, each node modifies the inadequate block through a consensus process.
Block Chain Advantages
Security - transactions are verified by participants in the block chain.
Data Transparency - Because block chains are distributed databases, they are managed and synchronized by multiple nodes. The block chain is designed from the beginning to allow multiple participants to access the same data.
Efficiency - In a block chain, it is more efficient to make backups than a centralized database because multiple participants manage redundant databases that contain information about the same transaction.
Applicable Fields of Block Chain
A reputation management system that is applicable to shared economic systems - You can determine whether you are a trustworthy user by verifying the identity of the user who uses the shared economy, past transactions, and reviews. You can share the proven reputation of your guests and hosts with your host, vehicle share. Airbnb acquired ChangeCoin in April 2016 with block-chain technology.
Distributed power grids - Until now, power supplies have been based on a centralized supply model, but they have evolved into distributed power grids for real-time pricing, distributed power supplies, and flexible power supply on demand. I will. Modernization of the grid through smart meters, energy storage devices, etc. is required for this change. By applying a block chain to a system that receives and transmits data between a large number of distributed power nodes, it will enable secure communication and transactions between nodes.
Applying block chains to the stock market - Applying block chains to the stock market can contribute to simplifying settlement and settlement procedures after stock trading. Block chaining reduces the duplication, identification and reconciliation costs of transactions across buyer customers, brokers, dealers, trust / deposit banks and liquidation companies. The Australian Stock Exchange (ASX) conducted research to apply block-chain technology to the stock exchange. The block chain was applied to the Clearing House Electronic Subregister (CHESS) to improve transaction end-to-end efficiency.
Compliance with AML and KYC - The block chain provides the opportunity to simplify and effectively transition to anti-money laundering compliance procedures. Today, transactional monitoring requires considerable manual effort. The use of a distributed database that shares long-term validated customer information on a block-chain basis helps streamline the KYC process associated with customers creating an account.
Major companies and vendors related to block chains
IBM has a prototype that uses Distributed Ledger technology to reduce inefficiencies in the global financing and IT supply chain and speed up the creation of balance sheets. IBM is participating in the Linux Foundation's Hyperledger project. In this project, we are developing a technology to create an enterprise-class distributed ledger for asset exchange.
Visa worked with DocuSign to conduct a PoC to apply block chains to record contracts such as car leasing and insurance. Block Chain-related start-ups, Epiphyte and Visa have developed a mobile remittance demonstration solution that provides transactions and settlements for the financial markets.
Nasdaq has developed NASDAQ Linq, a distributed ledger to support and record securities transactions in the private market. Using Linq, corporate customers have reduced the time it takes to buy and sell a stake in a private company, and paper stock certificates are no longer required. Nasdaq also uses block chains for corporate governance functions such as shareholder voting and has tested this application in Estonia. Nasdaq has invested in a block chain start-up chain.
The New York Melon Bank created its own digital currency, the BK coin, gave tokens to IT staff and built employee awareness. New York Melon Bank is developing a way to efficiently handle transactions on the internal network using block-chain technology. New York Melon Bank is a member of R3 Banking Consortium and Hyperledger project.
Note: Goldman Sachs' Blockchain Putting Theory into Practice, 2016
