The term blockchain can elicit reactions ranging from a blank stare (from the majority of the general public) to evangelical fervour (from over-enthusiastic early adopters). But most people who know a bit about the technology detect a pungent whiff of hype, leavened with the suspicion that, when the dust settles, it may have a significant role to play as a component of digital transformation.
The best-known example of blockchain technology in action is the leading cryptocurrency Bitcoin, but there are many more use cases — think of blockchain as the ‘operating system’ upon which different ‘applications’ (such as Bitcoin) can run. So, what is a blockchain?
At heart, a blockchain is a special kind of database in which ‘blocks’ of sequential and immutable data pertaining to virtual or physical assets are linked via cryptographic hashes and distributed as an ever-growing ‘chain’ among multiple peer-to-peer ‘nodes’. Additions to the blockchain can only be made after validation by a majority of nodes using a consensus mechanism, the two main ones being Proof of Work (PoW) and Proof of Stake (PoS), after which the new blocks are distributed to all nodes. At the moment, PoW is the most common consensus mechanism, the best-known example being Bitcoin mining by solving cryptographic puzzles. However, PoS is less costly in terms of computing resources and electricity, and can deliver faster throughput.
A blockchain is therefore a cryptographically secure distributed ledger in which each node has a verified, up-to-date and immutable history of all transactions that have ever taken place among participants that do not necessarily need to trust one another. Validated transactions cannot be altered or tampered with, and can only be reversed by a subsequent transaction.
There are two broad types of blockchain networks: ‘permissionless’, which anyone can join; and ‘permissioned’, in which participants are authenticated by whoever is running it. The latter can be further divided into ‘private’ and ‘community’ blockchain networks — a single enterprise versus a group of companies involved in a particular business process, for example. In permissionless blockchains, like those underpinning Bitcoin or Ethereum, more reliance is placed on consensus mechanisms to confirm identities and validate transactions.
Business rules that govern what happens to assets during transactions are known as smart contracts, which form a link between decentralized applications (or dApps) and the blockchain itself. Ethereum is the leading example of a smart contract-based blockchain system. The linkage of virtual or physical assets to digital tokens is called tokenisation, while the process of raising funds by offering a new cryptocurrency or token in exchange for traditional currency, or an existing cryptocurrency like Bitcoin, is called an Initial Coin Offering or ICO.

Image Credit: Zdnet
News This Week
Why ‘Peniaphobia’ Is Exploding Among Young People (And Why We Should Be Concerned)
An insidious illness is taking hold among a growing proportion of young people. Little known to the general public, peniaphobia—the fear of becoming poor—is gaining ground among teens and young adults. Discover the causes [...]
Team finds flawed data in recent study relevant to coronavirus antiviral development
The COVID pandemic illustrated how urgently we need antiviral medications capable of treating coronavirus infections. To aid this effort, researchers quickly homed in on part of SARS-CoV-2's molecular structure known as the NiRAN domain—an [...]
Drug-Coated Neural Implants Reduce Immune Rejection
Summary: A new study shows that coating neural prosthetic implants with the anti-inflammatory drug dexamethasone helps reduce the body’s immune response and scar tissue formation. This strategy enhances the long-term performance and stability of electrodes [...]
Scientists discover cancer-fighting bacteria that ‘soak up’ forever chemicals in the body
A family of healthy bacteria may help 'soak up' toxic forever chemicals in the body, warding off their cancerous effects. Forever chemicals, also known as PFAS (per- and polyfluoroalkyl substances), are toxic chemicals that [...]
Johns Hopkins Researchers Uncover a New Way To Kill Cancer Cells
A new study reveals that blocking ribosomal RNA production rewires cancer cell behavior and could help treat genetically unstable tumors. Researchers at the Johns Hopkins Kimmel Cancer Center and the Department of Radiation Oncology and Molecular [...]
AI matches doctors in mapping lung tumors for radiation therapy
In radiation therapy, precision can save lives. Oncologists must carefully map the size and location of a tumor before delivering high-dose radiation to destroy cancer cells while sparing healthy tissue. But this process, called [...]
Scientists Finally “See” Key Protein That Controls Inflammation
Researchers used advanced microscopy to uncover important protein structures. For the first time, two important protein structures in the human body are being visualized, thanks in part to cutting-edge technology at the University of [...]
AI tool detects 9 types of dementia from a single brain scan
Mayo Clinic researchers have developed a new artificial intelligence (AI) tool that helps clinicians identify brain activity patterns linked to nine types of dementia, including Alzheimer's disease, using a single, widely available scan—a transformative [...]
Leave A Comment