Blockchain, the distributed ledger technology, was explored in a 3-hour Data Summit 2018 presentation led by Paul Tatro, who covered the wide range of blockchain topics including what it is, the differences between public and private blockchains, use cases, and the meaning of terms such as “smart contracts,” “blocks,” “nonces,” “hashes,” “oracles,” and digital signatures.
There are five pillars to the blockchain ecosystem. Almost all of the blockchain products are open source, and they are also distributed, decentralized, automated, and tokenized.
According to Tatro, who is founder of Blockchain U Online, author of “Blockchain Unchained The Illustrated Guide to Understanding Blockchain," and host of the “Blockchain U Unchained Hour,” a weekly radio show on Blockchain.Radio, the reason for blockchain’s promise is the central problem that it solves: Business networks are inefficient.
In the “Introduction to Blockchain” workshop, Tatro explained that, “By delivering records that convey, offer and acceptance, blockchain is a value exchange protocol that provides a ‘trust layer’ for the internet and digitally records data in a shared ledge in packages called blocks.”
Without blockchain, the problem is that:
- Each participant must keep records (ledger) of all transactions.
- This inefficient process causes a duplication of effort on the part of all parties involved.
- Intermediaries are needed to validate the transactions,
- Additional costs are incurred through duplication of effort and the need for third party validation.
Blockchain advantages include:
A high degree of accountability
- Block data is complete, timely, accurate and widely available.
- Guarantees the validity of transactions by recording it:
- in a main ledger
- across a distributed system of ledgers
- connected through secure validation mechanism
Process integrity
- Transactions executed exactly as protocol commands removing the need for a trusted third party.
Immutability
- Blocks can only be inserted not edited or deleted.
Resilience against attacks
- Decentralized networks have no single point of failure and are better able to withstand malicious accounts.
While still in its early days, blockchain is already in its third stage, said Tatro. First was the development and acceptance of Bitcoin, which showed it can work. The second stage was the addition of the idea of smart contracts.
Now, the third wave is coming with new companies taking private and public key management and creating more of an operating system around the blockchain technology, he said. Like most of IT, blockchain is changing and adding features, moving “at 100 miles an hour,” Tatro said, but, in the next 12-18 months, there will be an acceleration of blockchain deployments as people begin to be more comfortable with it.
Challenges on the horizon, however, he added, include uncertainty about regulation, the need for greater adoption of a network to make it useful, and a lack of consensus around standards.
Many Data Summit 2018 presenters are making their presentations available following their sessions.
Data Summit 2019, presented by DBTA and Big Data Quarterly, is tentatively scheduled for May 21-22, 2019, at the Hyatt Regency Boston with pre-conference workshops on May 20.
For more information, go to www.dbta.com/DataSummit/2018/Presentations.aspx.