Best beginner guide on distributed ledger technology - Articlesonblockchain

Distributed Ledger Technology (DLT) is a form of digital record-keeping that uses a network of computers to store and share data. It is a type of distributed database that is maintained by multiple parties in a decentralised way. DLT is the foundation of cryptocurrencies like Bitcoin and Ethereum, but it can also be used to track and store other types of data, such as financial records, medical records, and legal documents.

What is a distributed ledger? 

 

A distributed ledger is a type of digital database that is shared across a network of computers. It is designed to be secure and immutable, meaning that it cannot be changed or deleted. All participants in the network have access to the same data, which is updated and validated in real-time as new transactions occur.

 

What are the advantages of distributed ledgers? 

 

The advantages of distributed ledgers include increased transparency, enhanced security, faster transaction times, and reduced costs. Additionally, distributed ledgers are resistant to tampering, making them more reliable than traditional databases.

 

How does distributed ledger technology work? 

 

DLT works by using a network of computers to store and share data. Each computer in the network keeps a copy of the ledger, which is regularly updated and validated by all participants. This ensures that the data stored on the ledger is accurate and secure.

 

What are some applications of distributed ledger technology? 

 

Distributed ledger technology (DLT) has a wide range of potential applications, some examples include:

Cryptocurrencies: Blockchain, the most well-known type of DLT, is used to create digital currencies such as Bitcoin.

Supply Chain Management: DLT can be used to create a tamper-proof record of all the transactions that occur within a supply chain, making it possible to trace the origin of goods and ensure that they are not counterfeit.

Smart Contracts: DLT can be used to create "smart contracts" which are self-executing contracts with the terms of the agreement between buyer and seller being directly written into lines of code.

Identity Management: DLT can be used to create a decentralized system for storing and verifying identity information, enabling individuals to have more control over their personal data.

Digital Voting: DLT can be used to create a secure, transparent, and auditable voting system that allows for remote voting and prevents voter fraud.

Financial Services: DLT can be used to increase the efficiency and reduce the cost of financial transactions by creating a shared database of financial assets and enabling real-time settlement of trades.

Gaming and Digital collectibles: DLT can be used to create unique digital assets that can be owned and traded by players, creating new revenue streams for game developers.

Real estate: DLT can be used to create a tamper-proof record of property ownership, making it easier to buy, sell, and transfer property.

These are just a few examples, but the possibilities for DLT are vast and new use cases are constantly being developed.

 

What are some of the challenges associated with distributed ledger technology? 

 

Distributed ledger technology (DLT) is a relatively new technology, and as such, it faces a number of challenges. Some of the main challenges include:

Scalability: As the number of users and transactions on a DLT network increases, the network can become slow and expensive to use. This is particularly an issue for blockchain, the most well-known type of DLT, which is currently facing scalability challenges.

Regulation: DLT is a decentralised technology, and it is not yet clear how it should be regulated. Some governments have taken a cautious approach and have banned or restricted the use of certain types of DLT, while others have embraced it.

Security: DLT is a secure technology, but it is not immune to hacking and other forms of cyberattacks. As the technology develops, it will be important to continue to improve the security of DLT networks to protect users' data and assets.

Interoperability: DLT networks are not currently able to easily communicate with each other, making it difficult for users to move assets and data between different networks. This can be a significant barrier to the widespread adoption of DLT.

Adoption: DLT is a complex technology, and it can be difficult for non-technical users to understand and use. To achieve mainstream adoption, it will be necessary to develop user-friendly interfaces and applications that make DLT accessible to a wider audience.

Energy consumption: Some of the public blockchain networks like Bitcoin and Ethereum are consuming huge amount of energy which is a significant environmental concern.

Privacy and Confidentiality: While the transparency and immutability of DLT is one of its key advantages, it also raises concerns about privacy and confidentiality. This is a significant issue for industries that deal with sensitive data, such as healthcare and finance.

Overall, DLT is a promising technology with many potential benefits, but it will require ongoing research and development to address these challenges and fully realize its potential.

 

Conclusion:

By understanding how distributed ledger technology works and its potential applications, you can begin to explore the possibilities of this revolutionary technology. Whether you’re a developer, investor, or just an enthusiast, DLT has the potential to revolutionise the way we exchange data, assets, and value.

Ledger: Can a Power Systems Rely on Blockchain Technology? - Articles

Source: https://www.cigre.org/article/GB/the-application-of-blockchain-technology-in-power-systems

Existing system challenges can be resolved by using the Blockchain digital ledger technology to assist multiple power applications at the generation, transmission, distribution, and consumption stages. Trading renewable energy certificates and credits based on actual energy usage can be automated using blockchain ledger technology.

Context:

Blockchain “Distributed Ledger Technology” (DLT) is capable of managing and storing transactions involving numerous parties. DLT can be used for any multi-step transaction-based application that demands security, traceability, and visibility because of its immutable, secure, and transparent nature. By removing the need for a middleman and connecting the buyer and seller directly, blockchain technology lowers the expenses and fees associated with transactions.

In the P2P network, blocks that are identically stored for each market participant are used to store any transactions. The owner's digital signature authorises each transaction in this digital ledger, ensuring its authenticity and protecting it from fraud. Based on who may add data to the chain and access the distributed ledger, there are three different types of blockchain platforms: Public, Private, and Consortium.

Can blockchain be implemented in power grids? - Articlesonblockchain

Using blockchain digital ledger has many advantages, few of them are secure, transparent, and robust network with a tamper-proof data record accessible to all participants in the network. With these features, the existing difficulties in the power system can be addressed in the production, transmission, distribution, and consumption phases.

How does blockchain help renewable energy? - Articlesonblockchain

• The actual transactions between the producer and consumer for consuming the renewable energy can be automated.

• Payments in the P2P microgrids can be created through Blockchain smartcontracts.

• For coordination of wholesale power trading, blockchain removes the necessity of middle man management like brokers, indexing agencies, specialised energy trading, or risk-management software.

• Interactive dashboards on customer utility, grid interactions, payment information, and energy consumption can be managed efficiently using the blockchain distributed ledger technology.

What Infrastructure used in blockchain technology for energy trading? -Articlesonblockchain

The critical components for implementing blockchain technology are full nodes (computers), partial nodes (smartphones or smart meters), a communication network, and a software platform.

Conclusion:

Blockchain digital ledger technology has the potential to drastically improve energy markets. However, because present implementations are on a small scale, extensive work is required before any wider implementation can be a serious disruptive force in this field.

Note: For case studies on Power Systems Rely on Blockchain Technology refer to below links:

[0] - https://www.cigre.org/article/GB/the-application-of-blockchain-technology-in-power-systems

[1] - https://www.ceew.in/cef/masterclass/explains/the-role-of-blockchain-technology-in-the-power-sector

Ledgers: Uses of Blockchain Smartcontracts - Article

Uses of Smart Contracts:

Blockchain Smartcontracts can be used in almost all fields, starting from healthcare to supply chain to financial services. Some examples are as follows:

Voting system:

Smartcontracts provide a secure environment making the voting system less susceptible to manipulation. Votes using smartcontracts would be digital ledger-protected, which is extremely difficult to decode.

Moreover, smartcontracts could increase the turnover of voters, which is historically low due to the inefficient system that requires voters to line up, show identity, and complete forms. Voting, when transferred online using smartcontracts, can increase the number of participants in a voting system.

Healthcare Industry:

Blockchain can store the encoded health records of patients with a private key. Only specific individuals would be granted access to the records for privacy concerns. Similarly, research can be conducted confidentially and securely using smartcontracts.

All hospital receipts of patients can be stored on the blockchain and automatically shared with insurance companies as proof of service. Moreover, the digital ledger technology can be used for different activities, such as managing supplies, supervising drugs, and regulation compliance.

Supply chain Industry:

Traditionally, supply chains suffer due to paper-based systems where forms pass through multiple channels to get approvals. The laborious process increases the risk of fraud and loss.

Blockchain can nullify such risks by delivering an accessible and secure digital version to parties involved in the chain. Smartcontracts can be used for inventory management and the automation of payments and tasks.

Financial services Industry:

Smartcontracts help in transforming traditional financial services in multiple ways. In the case of insurance claims, they perform error checking, routing, and transfer payments to the user if everything is found appropriate.

Smartcontracts incorporate critical tools for bookkeeping and eliminate the possibility of infiltration of accounting records. They also enable shareholders to take part in decision making in a transparent way. Also, they help in trade clearing, where the funds are transferred once the amounts of trade settlements are calculated.

Cited Source: https://corporatefinanceinstitute.com/resources/valuation/smart-contracts/

Ledger: Applications of Blockchain Smartcontract - Articles

Examples of smartcontract applications include Real Estate, Vehicle Ownership, Music Industry, Government Elections, Management, Health care. They can be used for financial applications purposes like trading, investing, lending, and borrowing; and they can even be used to configure entire corporate structures.

Real estate: Share the proceeds between the persons directly engaged instead of paying the middleman. As an illustration, a smartcontract to transfer apartment ownership whenever a specific number of resources have been sent to the seller's account (or wallet).

Vehicle ownership: A smartcontract that tracks vehicle ownership and upkeep can be implemented in a blockchain. For instance, the smartcontract may mandate car maintenance every six months, failing to which would result in the suspension of a driver's licence.

Music Business: The songs industry may use a blockchain to store ownership information about music. When a music is utilised commercially, a smartcontract that is integrated into the blockchain may be used to credit the owner's account with royalties. It can be effective in settling ownership conflicts as well.

Elections for public office: It would be exceedingly difficult to decode the voter address and change the vote once it has been entered on the blockchain, increasing trust against unethical acts.

Management: Many choices that are made late or in a delayed manner may be streamlined and automated using the blockchain application in management. Each judgement is open and accessible to all parties with the necessary power (an application on the private blockchain). Using a smartcontract, for instance, 10 tonnes of plastic bag production might start the delivery of raw materials.

Healthcare: Using smartcontracts to automate healthcare payment procedures can help stop fraud. Each procedure is recorded in the ledger, and the smartcontract may ultimately calculate the total of all the transactions. Before the hospital bill has been paid and can be entered in the smartcontract, the patient cannot be released from the facility.

Ledger: Working of Blockchain Smartcontract - Article

A Blockchain Smartcontract is just a digital contract that has blockchain security code. It contains certain instructions and permissions defined in code that need to happen in a specific order in order to for the smart contract's terms to be accepted. 

In the contract, deadlines may be included due to time restrictions. Every smart contract has a blockchain address. The contract may be interacted with by using its address provided the contract has been broadcasted on the network.

Idea behind smart contracts:

Logic of the Blockchain Smartcontract is pretty simple. They are executed on a basis of simple programming logic, IF-THEN condition.

Example: 

• IF you send object A, THEN the sum (of money, in cryptocurrency) will be transferred to you.

• IF you transfer a certain amount of digital assets (cryptocurrency, for example, ether, bitcoin), THEN the A object will be transferred to you.

• IF I finish the work, THEN the digital assets mentioned in the contract will be transferred to me.

Note: The WHEN constraint can be added to include the time factor in the smart contracts. It can be seen that these smart contracts help set conditions that have to be fulfilled for the terms of the contract agreement to be executed. There is no limit on how much IF or THEN you can include in your intelligent contract. [0]

Operation of a blockchain smartcontract: 

Predefined Contract: Multiple parties identify the cooperative opportunity and desired outcomes and agreements could include business processes, asset swaps, etc.

Events: 

Set conditions: Smart contracts could be initiated by parties themselves or when certain conditions are met like financial market indices, events like GPS locations, etc.

Code business logic: A computer program is written that will be executed automatically when the conditional parameters are met.

Encryption and blockchain technology: Encryption provides secure authentication and transfer of messages between parties relating to smart contracts.

Execution and Settlement: In blockchain iteration, whenever consensus is reached between the parties regarding authentication and verification then the code is executed and the outcomes are memorialized for compliance and verification.

Blockchain updates: After smart contracts are executed, all the nodes on the network update their digital ledger to reflect the new state. Once the record is posted and verified on the blockchain network, it cannot be modified, it is in append mode only.

Cited Source:

 [0] - https://www.geeksforgeeks.org/smart-contracts-in-blockchain/